The least-squares regression line for predicting value of NBA (National Baseball

Question

The least-squares regression line for predicting value of NBA (National Baseball Association) from revenue is:

Value = 21.4 + 2.59(revenue)

The correlation between revenue and team value (rounded to four decimal places) is r = 0.9265. Determine which of the following statements describes what the correlation says about the success of the regression line in predicting the values of the 29 teams.

Select one:

a. The correlation is low, meaning that the line cannot predict the team-values well. The line explains about 0.86% of the variability in team value.

b. The correlation is low, meaning that the line cannot predict the team-values well. The line explains about 0.93% of the variability in team-value.

c. The correlation is high, meaning that the line can predict the team-values quite well. The line explains about 86% of the variability in team-value.

d. The correlation is high, meaning that the line can predict the team-values quite well. The line explains about 93% of the variability in team-value.

Explanation / Answer

r = 0.9265 , therefore R2 = 0.8584 ~ 86%

The correlation is high, meaning that the line can predict the team-values quite well. The line explains about 86% of the variability in team-value.

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