Data Were Collected for a Sample of Companies Regarding Their

question 9

Multiple Choice

Data were collected for a sample of companies regarding their investment in quality improvement efforts and cost savings realized as a result (both measured as a percentage of sales revenue) . The correlation coefficient for these data is r = 0.913. If the data were collected for individual departments within companies rather than at the company level, we would expect

• A) a stronger correlation
• B) a weaker correlation
• C) the same correlation
• D) fewer outliers in the data
• E) No expectation with regards to regression modeling can be drawn from the given information.

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Definitions:

Price Floor

A government-imposed minimum price below which a certain good or service cannot be sold, often set to protect producers or sectors.

Lobby

The act of attempting to influence the decisions of government officials, typically by special interest groups.

Binding Price Ceiling

A maximum price set by the government below the equilibrium price, preventing suppliers from raising the price above it, leading to shortages.

Surplus

The situation in which the quantity of a good supplied exceeds the quantity demanded, often resulting in downward pressure on prices.