I What Is the Range of Values That the Coefficient

question 123

Multiple Choice

i. What is the range of values that the coefficient of determination can assume? ii. What is a measure of the scatter of observed values around the regression line called?
iii. If the correlation between sales and advertising is +0.6, what percent of the variation in sales can be attributed to advertising?

• A) 0% to 1%; standard variation;36%.
• B) both positive and negative values; standard deviation;6%.
• C) 0% to 100%; standard error of the estimate; 36%.
• D) 0% to 100%; standard variation;36%.
• E) both positive and negative values; standard error of the estimate; 36%.

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Definitions:

Income Bonds

Bonds that pay interest only when the issuer has sufficient earnings, providing a variable income stream based on the issuer's profitability.

Yield to Maturity

The total return anticipated on a bond if it is held until the date it matures, reflecting interest and price appreciation.

Par Value

The face value of a bond or stock, representing the amount that will be returned to the investor at maturity or the nominal value of a share.

Capital Gains Yield

The percentage change in the price of an investment over a specified period, not accounting for dividends or other earnings.