Question

For the US over the years 1980-2004 the correlation between

X = personal medical expenditures as a % of total personal
consumption expenditures and Y+ personal savings as a % of personal
disposable income was -.91 such a correlation coefficient
reflects:
A.) a weak direct linear relationship between X and Y
B.) a weak inverse linear relationship between X and Y
C.) A strong direct linear relationship between X and Y
D.) A strong inverse linear relationship between X and Y

Answer 1

The correlation of -.91 between personal medical expenditures as a percentage of consumption expenditures and personal savings as a percentage of disposable income indicates a strong inverse linear relationship between the two.

Step-by-step explanation:

The correlation between X (personal medical expenditures as a % of total personal consumption expenditures) and Y (personal savings as a % of personal disposable income) was -.91. This value indicates that there is a strong inverse linear relationship between X and Y. When the correlation coefficient is close to -1, it reflects a strong negative relationship, meaning that as one variable increases, the other variable tends to decrease.