Question
4) Analysis of sales (the independent variable) to cash flows (the dependent variable) data for linear regression produces an intercept of -$124,666 and a slope
4) Analysis of sales (the independent variable) to cash flows (the dependent variable) data for linear regression produces an intercept of -$124,666 and a slope of 0.1823. Which correctly explains the slope value?
a. If sales rise by one-dollar, net cash flow would increase by 18.23%
b. 0.1823 is multiplied by the current period actual and (1 - 0.1823) is multiplied by the current period forecast
c. If sales drop by one-dollar, net cash flow would drop by $0.1823
d. 18.23% of the change in net cash flow is explained by the change in net sales
5) Analysis of sales (the independent variable) to cash flows (the dependent variable) data for linear regression produces an intercept of -$124,666 and a slope of 0.1823. Which correctly explains the intercept value?
a. If there were no sales in a given period, the firm would have net cash outflows of $124,666 that period
b. The intercept of -$124,666 shows that sales and cash flows are negatively correlated
c. The intercept of -$124,666 shows what sales will be when cash flows equal zero
d. The break-even amount of sales for this organization is $124,666
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