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Forecasting

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA MA – FIA FMA › Forecasting

  • This topic has 1 reply, 2 voices, and was last updated 1 year ago by John Moffat.
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  • August 19, 2021 at 8:07 pm #632249
    suleymanabuzerli
    Member
    • Topics: 84
    • Replies: 32
    • ☆☆

    Using data from twelve European countries, it has been calculated that the correlation between the level
    of car ownership and the number of road deaths is 0.73.
    Which TWO of the statements shown follow from this?
    A)High levels of car ownership cause high levels of road deaths
    B)There is a strong relationship between the level of car ownership and the number of road deaths
    C)53% of the variation in the level of road deaths from one country to the next can be explained by
    D)the corresponding variation in the level of car ownership
    73% of the variation in the level of road deaths from one country to the next can be explained by
    the corresponding variation in the level of car ownership

    Hello,the answer is given B and C
    but why?

    B and D should be

    August 20, 2021 at 7:51 am #632300
    John Moffat
    Keymaster
    • Topics: 57
    • Replies: 51543
    • ☆☆☆☆☆

    As I explain in my free lectures, it is the coefficient of determination that measure what % of the level of road deaths is explained by the level of car ownership (not the coefficient of correlation).

    The coefficient of determination is 0.73^2 = 0.53 (or 53%).

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