A Correlation Coefficient of −.67 Tells Us

question 8

Multiple Choice

A correlation coefficient of −.67 tells us

• A)the magnitude of the correlation only.
• B)the direction of the correlation only.
• C)the magnitude and direction of the correlation.
• D)neither the magnitude nor the direction of the correlation.

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Definitions:

Overhaul Costs

Expenses associated with performing major maintenance or repairs to extend the life of an asset.

Salvage Value

The anticipated remaining worth of an asset when it reaches the end of its operational lifespan.

Net Present Value

The difference between the present value of cash inflows and the present value of cash outflows over a period of time.

Discount Rate

The interest rate used in discounted cash flow analysis to determine the present value of future cash flows.