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(1) O positively (2) O less than negatively O greater than not YOU ANSWERED: A. 17. The accompanying data represent the total compensation for 12 randomly selected chief executive officers (CEO) and the company's stock performance in 2017. Complete parts (a) through (d) below 13 Click the icon to view the CEO data. (a) One would think that a higher stock return would lead to a higher compensation. Based on this, what would likely be the explanatory variable? Stock return Compensation (b) Draw a scatter diagram of the data. Choose the correct graph below. O A. OB. O C. D Q Q 60- 40- Q a Stock Return (%) CEO Pay (millions) Stock Return (%) CEO Pay (millions) -20- TTT 20 60 40 40 -20 60 Stock Return (%) CEO Pay (millions) CEO Pay (millions) Stock Return (%) (c) Determine the linear correlation coefficient between compensation and stock return. = (Round to three decimal places as needed.) (d) Does a linear relation exist between compensation and stock return? Does the explanatory variable appear to play a role in determining the response variable? The linear correlation coefficient is close to (1) So (2) linear relation exists between the company's stock performance and their CEO's compensation. (3) (4) to play a role in determining (5) 13: CEO Data CEO Pay Return Company (millions) (%) WALT DISNEY CO 36.3 7.7 AMERICAN TOWER CORP 13.1 38 SVB FINANCIAL GROUP 6.1 36 VERISIGN INC 9 50 SCHWAB CHARLES CORP 14.3 31 HERSHEY CO 10.3 12 DONALDS CORP 21.8 45 OCCIDENTAL PETROLEUM CORP 12.7 8.4 HELMERICH AND PAYNE INC 6.2 - 19 FASTENAL CO 2 20 ROYAL CARIBBEAN CRUISES LTD 13.3 48 MOSAIC CO 8.4 - 10 (1) O o, (2) O no (3) O Stock performance (4) O does appear (5) O the compensation of a CEO. O a negative The compensation of a CEO does not appear O stock performance. 0 + 1 , O a positive 18. What does it mean to say that the linear correlation coefficient between two variables equals 1? What would the scatter diagram look like? Choose the correct answer below. A. When the linear correlation coefficient is 1, there is a perfect negative linear relation between the two variables. The scatter diagram would contain points that all lie on a line with a negative slope. B. When the linear correlation coefficient is 1, there is a perfect horizontal linear relation between the two variables. The scatter diagram would contain points that all lie on a horizontal line. C. When the linear correlation coefficient is 1, there is a perfect positive linear relation between the two variables. The scatter diagram would contain points that all lie on a line with a positive slope. OD. When the linear correlation coefficient is 1, there is no linear relation between the variables. The scatter diagram would contain points that show no discernable relationship. 19. What does it mean if r = 0? Choose the correct answer below. A. A linear relationship does exist between the variables. B. No linear relationship exists between the variables O C. No relationship exists between the variables. D. A relationship does exist between the variables. 20. Suppose that two variables, X and Y, are negatively associated. Does this mean that above-average values of X will always be associated with below-average values of Y? Explain. Choose the correct answer below. A. Yes, because if one or more above-average values of X are associated with above-average values of Y, the variables cannot be negatively associated. B. No, because association does not mean that every point fits the trend. The negative association only means that above-average values of X are generally associated with below-average values of Y. C. No, because there will always be at least one point that does not fit the trend. D. No, because when two variables, X and Y, are negatively associated, above-average values of X are associated with above-average values of Y. 21. Complete the sentence below. The linear correlation coefficient is always between - 1 and 1 , inclusive. Type integers or decimals. Use ascending order.) 22. Select the correct choices that complete the sentence below. The closer r is to + 1, the stronger the evidence is of positive association between the two variables
