Purchase Solution

# Determine the Correlation of Determination

Not what you're looking for?

Recall that the correlation coefficient is a single value that captures the direction and extent of linear association between 2 random variables (securities). The formula for measuring covariance is equal to the correlation coefficient (rho) multiplied by the standard deviation for security1 multiplied by the standard deviation of security2.

Based on the Summary Output of Excel Regression (aka Analysis of Variance (ANOVA)) output listed below answer the following questions:
5a. Determine the Correlation of Determination (r squared):
5b. Determine the Correlation coefficient "r" (rho symbol = ):
5c. Determine (calculate) the Covariance (formula given above) between GM and S&P500. Note: the Covariance of an asset with itself is equal to its Variance. The standard deviation (sigma symbol = ) is equal to the square root of the variance.

##### Solution Summary

Determine the Correlation of Determination

##### Solution Preview

1. R squared is given by the table, 0.32820.

2. The correlation coefficient, or r, is the square root of R squared, ...

##### Employee Orientation

Test your knowledge of employee orientation with this fun and informative quiz. This quiz is meant for beginner and advanced students as well as professionals already working in the HR field.

##### Change and Resistance within Organizations

This quiz intended to help students understand change and resistance in organizations

##### Understanding the Accounting Equation

These 10 questions help a new student of accounting to understand the basic premise of accounting and how it is applied to the business world.

##### Income Streams

In our ever changing world, developing secondary income streams is becoming more important. This quiz provides a brief overview of income sources.

##### Academic Reading and Writing: Critical Thinking

Importance of Critical Thinking