When Testing Whether the Correlation Coefficient Differs from Zero, the Value

question 78

Multiple Choice

When testing whether the correlation coefficient differs from zero, the value of the test statistic is t₂₀ = −2.95 with a corresponding p-value of 0.0061. At the 5% significance level, can you conclude that the correlation coefficient differs from zero?

• A) Yes, since the p-value is less than 0.05.
• B) Yes, since the absolute value of the test statistic exceeds 0.05.
• C) No, since the p-value is less than 0.05.
• D) No, since the absolute value of the test statistic exceeds 0.05.

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Definitions:

Rent-Seeking Activity

Economic practices aimed at increasing one's share of existing wealth without creating new value, often through manipulation or exploitation of the political environment.

Demand Schedule

A table that shows the quantity of a good or service that consumers are willing to buy at each price point.

Marginal Cost

The incremental expense incurred from the production of an extra unit of a good or service.

Maximum Profit

The highest possible financial gain achievable by a firm from its operations, over a certain period of time.