Medium2 marksMultiple Choice
ACCA · Question 04 · Statistical Techniques
Section A
AgriYield Corp is analyzing the relationship between the amount of specialized fertilizer applied (x) and the resulting crop yield (y). The correlation coefficient (r) is calculated as +0.85. Which of the following statements is the most accurate interpretation of this result?
Section A
AgriYield Corp is analyzing the relationship between the amount of specialized fertilizer applied (x) and the resulting crop yield (y). The correlation coefficient (r) is calculated as +0.85. Which of the following statements is the most accurate interpretation of this result?
Answer options:
A.
85% of the variation in crop yield is explained by the amount of fertilizer applied.
B.
There is a strong positive linear relationship between fertilizer applied and crop yield.
C.
Applying more fertilizer guarantees an 85% increase in crop yield.
D.
There is a weak positive linear relationship, as the value is less than 1.0.
How to approach this question
Recall that the correlation coefficient (r) ranges from -1 to +1. A value of +0.85 is close to +1, indicating a strong positive linear relationship.
Full Answer
B.There is a strong positive linear relationship between fertilizer applied and crop yield.✓ Correct
The correlation coefficient (r) measures the strength and direction of a linear relationship between two variables. +0.85 is a strong positive correlation. Option A incorrectly describes r-squared (0.85^2 = 0.7225).
Common mistakes
Confusing 'r' with 'r-squared' (Option A is the most common distractor).
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