- CFA Exams
- CFA Level I Exam
- Topic 1. Quantitative Methods
- Learning Module 10. Simple Linear Regression
- Subject 3. Analysis of Variance
CFA Practice Question
If the coefficient of correlation equals 0.61, it indicates that the proportion of the variation in the dependent variable explained by the variation in the independent variable is
A. 37%
B. 61%
C. 98%
Explanation: 0.61 x 0.61 = 37%.
User Contributed Comments 3
| User | Comment |
|---|---|
| shiva5555 | wtf? is the coefficient already squared? |
| MathewBinu | In models with one only indepedent variable, the coeffiecent of determination(R^2) can be calculated simply as equals r^2 (correlation coefficent. The question is the definition of R^2. |
| jonan616 | coefficient of correlation = r coefficient of determination = r^2 |