Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

In this case, the computed sample correlation coefficient is -0.92498. This value is close to -1, indicating a strong negative correlation between the price and

In this case, the computed sample correlation coefficient is -0.92498. This value is close to -1, indicating a strong negative correlation between the price and the number of flash drives sold. This means that as the price of the flash drives increases, the number of flash drives sold tends to decrease, and vice versa. The strength of the correlation is determined by the absolute value of 'r'. The closer the absolute value of 'r' is to 1, the stronger the correlation. In this case, the absolute value of 'r' is 0.92498, which is close to 1, indicating a strong correlation. Therefore, the change in the number of flash drives sold is quite similar to the change in the price, but in the opposite direction. This is consistent with the law of demand in economics, which states that as the price of a product increases, the quantity demanded tends to decrease, all other things being equal

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Real Econometrics The Right Tools To Answer Important Questions

Authors: Michael Bailey

2nd Edition

0190857463, 978-0190857462

More Books

Students also viewed these Economics questions

Question

What is a multivariate data set?

Answered: 1 week ago