Question

You use a line of best fit for a set of data to make a prediction about an unknown value. The correlation coefficient for your data set is -0.015. Can you be confident that your predicted value will be reasonably close to the actual value?

a. Yes, because the correlation is close to zero, it is strong.
b. Yes, No, because the correlation is close to zero, it is strong.
c. No, because the correlation is close to zero, it is weak.
d. No, because the correlation is negative, it is weak.

Answer 1

Following are the solution to this question:

Explanation:

For this set, the correlation coefficient is = -0.015.

It shows that financial variables have trust issues. Once a price rises, the other one is decreasing the value of -0,015 shows, that there are several fewer associations in the set of data among x and y and between y values. This interaction also can range between -1 to 1, to 0 being completely unrelated. But you'd never be sure, in this situation, 0.015 is very similar to 0.

It means that your prediction is nothing better than just a wild choice. Its odds of an estimated value being relatively close to the actual result are therefore much smaller as the points are it's hardly the best match.