The OECD (Organization for Economic Cooperation and Development) consists of advanced, industrialized countries. For these nations, a recent prediction equation6 relating y = child poverty rate to x = social expenditure as a percentage of gross domestic product is

ˆy = 22 − 1.3x. The y-values ranged from 2.8% (Finland)

to 21.9% (the United States). The x-values ranged from 2% (the United States) to 16% (Denmark).

(a) Interpret the y-intercept and the slope.

(b) Find the predicted poverty rates for the United States and for Denmark.

(c) The correlation is −0.79. Interpret.