business Statistics

Question

Using your favorite statistics software package, you generate a scatter plot with a regression equation and correlation coefficient. The regression equation is reported as y=−30.18x+55.02 and the

r=−0.138r=-0.138.

What proportion of the variation in y can be explained by the variation in the values of x? 

r² = %

Report answer as a percentage accurate to one decimal place.

Answer 1

Hi Salma,

r² is exactly what it sounds like, the correlation coefficient squared, so:

r²=(-0.138)²

r²=0.019

Note that this is always positive due to the squaring. As a percentage, multiply this value by 100 to get:

r²=1.9%

I hope this helps.