Which of the Following Statements Is True About Correlation Coefficients

question 118

Multiple Choice

Which of the following statements is true about correlation coefficients?

• A) The sign of the number refers to the strength of the relationship.
• B) A negative correlation coefficient means that the two variables are not related to each other.
• C) A positive correlation coefficient implies that as one variable increases, the other also increases.
• D) The magnitude of the number shows the direction of the relationship.

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Definitions:

Money Supply

The total amount of money available in an economy at a particular time, including cash, deposits, and other liquid assets.

Sacrifice Ratio

The number of percentage points of annual output lost in the process of reducing inflation by 1 percentage point.

Inflation

An increase in the overall level of prices in the economy

Output

The amount of goods or services produced by a firm, industry, or economy over a given period.