An international finance analyst using a sample of 60 projects ran a correlation

Question

An international finance analyst using a sample of 60 projects ran a correlation to see if there is a correlation between project interest rate and projects total investment in $1000 Correlation: Dirinvest1000. Intecest Correlations Pearson correlation -0.438 P-value 0.002 What is the correct interpretation of the correlation coefficient in this example? O There is a weak negative correlation between interest rates and direct investments There is a strong negative correlation between interest rates and direct investments. There is a moderate negative correlation between interest rates and direct investments. TNOETS that there is a correlation between interest rates and direct investments. O O +

Explanation / Answer

Here r = -0.438

The minus sign indicates that there is negative correlation.

The value shows the moderate coorelation.

Hence the correct interpretation is

There is a moderate negative correlation between interest rates and direct investments.

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