According to the results below, what is the correlation between stock price and EPS?
The regression equation is: Stock Price $= - 0.49 + 14.8 \mathrm { EPS }$
$\begin{array} { l r r r r } \text { Predictor } & \text { Coef } & \text { SE Coef } & \text { T } & \text { P } \ \text { Constant } & - 0.486 & 4.032 & - 0.12 & 0.906 \ \text { EPS } & 14.8129 & 0.9437 & 15.70 & 0.000 \end{array}$
$$\mathrm { S } = 7.63235 \mathrm { R } - \mathrm { Sq } = 95.0 \%$$
A) -0.975
B) 0.906
C) 0.950
D) 0.975
E) Cannot be determined from the information given.

Question

According to the results below, what is the correlation between stock price and EPS? 
The regression equation is: Stock Price $= - 0.49 + 14.8 \mathrm { EPS }$
$\begin{array} { l r r r r } \text { Predictor } & \text { Coef } & \text { SE Coef } & \text { T } & \text { P } \ \text { Constant } & - 0.486 & 4.032 & - 0.12 & 0.906 \ \text { EPS } & 14.8129 & 0.9437 & 15.70 & 0.000 \end{array}$
$$\mathrm { S } = 7.63235 \mathrm { R } - \mathrm { Sq } = 95.0 \%$$
A) -0.975
B) 0.906
C) 0.950
D) 0.975
E) Cannot be determined from the information given.

Quizplus · Accepted Answer

The correlation coefficient (r) is equal to the square root of the coefficient of determination (R-sq), which is given as 0.95 in the output. Therefore, r = sqrt(0.95) = 0.975. The correlation between stock price and EPS is strongly positive.

According to the Results Below, What Is the Correlation Between =−0.49+14.8EPS= - 0.49 + 14.8 \mathrm { EPS }=−0.49+14.8EPS

According to the Results Below, What Is the Correlation Between $= - 0.49 + 14.8 \mathrm { EPS }$