Before Calculating a Correlation Coefficient, a Researcher Wants to Determine

question 17

Multiple Choice

Before calculating a correlation coefficient, a researcher wants to determine whether the relationship between the two variables is linear.Which of the following would be most appropriate to use?

• A) Histogram
• B) Frequency polygon
• C) Data matrix
• D) Scatterplot

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Definitions:

Price-Earnings Ratio

A valuation metric for stocks, calculated by dividing the market price per share by the earnings per share, used to assess a company's relative valuation.

Retained Earnings

Profits that a company keeps after dividends are paid, which are often reinvested into the business for growth or debt repayment.

Closed Economy

An economic model that remains isolated from global trade and international financial exchanges.

Private Saving

The portion of individual or household income that is not consumed and is set aside for future use, typically in the form of savings accounts, investments, and retirement accounts.