Why Do We Create a Scatter Plot of the Data

question 60

Multiple Choice

Why do we create a scatter plot of the data in regression analysis?

• A) To compute the error terms.
• B) Because Excel calculates the function from the scatter plot.
• C) To visually check for a relationship between X and Y.
• D) To estimate predicted values.

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Definitions:

Salvage Value

The predicted worth of an asset upon reaching the end of its service life.

Discount Rate

The discount rate applied to calculate the present value of future cash flows.

Automated Equipment

Machinery that operates with minimal human intervention, often used to increase efficiency and consistency in production.

Profitability Index

A financial metric that measures the return on investment for a project or investment relative to its cost.