For families who live in apartments the correlation between the family's income and the amount of rent they pay is r = 0.60. Which is true?
I. In general, families with higher incomes pay more in rent. II. On average, families spend 60% of their income on rent.
III. The regression line passes through 60% of the (income$, rent$) data points.
A) I, II, and III
B) II only
C) I only
D) I and II only
E) I and III only

Question

Quizplus · Accepted Answer

The correlation coefficient (r = 0.60) indicates a positive relationship between family income and the amount of rent they pay, meaning as one variable increases, so does the other. This supports statement I. However, a correlation coefficient does not indicate the percentage of income spent on rent (II) nor does it imply that the regression line passes through a specific percentage of data points (III).

For Families Who Live in Apartments the Correlation Between the Family's