Which of the Following Statements About Regression/correlation Analysis Is FALSE

question 49

Multiple Choice

Which of the following statements about regression/correlation analysis is FALSE?

• A) Correlation analysis involves the measurement of the closeness of the relationship between two or more variables.
• B) Regression analysis involves the derivation of an equation that relates the criterion variable to one or more predictor variables.
• C) Regression analysis can establish the causal relationship between two or more variables.
• D) The regression line minimizes the sum of the squared deviations about the line.
• E) It is much more common to conduct regression analyses using a computer.

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Definitions:

Dividends Per Share

The total amount of dividends declared by a company for each share of its stock, indicating the income investors receive from holding shares in the company.

Financial Leverage

The use of borrowed funds to increase one's investment potential, which can magnify both gains and losses.

Current Assets

Short-term assets that are expected to be converted into cash within one year.

Shareholders' Equity

The residual interest in the assets of a corporation after deducting liabilities, representing the net worth attributable to shareholders.