A risk casualty company has 84 condo properties that have been damaged by fire,

Question

A risk casualty company has 84 condo properties that have been damaged by fire, flooding, and other causes Each property had previously been assigned a risk index. The firm wants to find out the relationship between AmtDamage 1000im $1000 and property RiskIndex100 in 100's of points. The results are as follows. I Regression Analysis: AmtDamage1000 versus RiskIndex100 Analysis of Variance DF dSMS F-Value P.Value 10881 1088L0 88.69 0.000 Source Riskindex100 110881 10881O 88.69 000 Error Tocal Model Summary 83 10183 1227 21064 11.0766 SLAS% SL07% 4a80% Coefficients Term Constant Riskindex100 .508 058S2 0.000 1.00 Regression Equation AmtDamag100022.84+5508 Riskinde100 SE Goel T.value PV V 2284 310 737 0.000 What is true about the coefficient of determination for the example above? It can be interpreted to mean that 51% of the variation in risk index is accounted for by the art damage It can be interpreted to mean that 51% of the variation in amount damage is accounted for by the riskidex @ It can be interpreted to mean that there is a 51% chance that there is a linear relationship between Risklndex It can be interpreted to mean that it is a poor regression with a low predictive power

Explanation / Answer

Coefficient of determination R squarred can be interpreted to mean that 51% of the variation in amount damage is accounted for by the risk index.

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