Correlation and RegressionMCQMTP Mar 22Question 3730 of 188
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If the two regression co-efficient are 4\displaystyle 4 and 0.16\displaystyle 0.16 the percentage of unexplained variation is:

Options

A64\displaystyle 64
B36\displaystyle 36
C54\displaystyle 54
D46\displaystyle 46
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Correct Answer

Option b36\displaystyle 36

All Options:

  • A64\displaystyle 64
  • B36\displaystyle 36
  • C54\displaystyle 54
  • D46\displaystyle 46

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Detailed Solution & Explanation

The regression coefficients are given as byx=4\displaystyle b_{yx} = 4 and bxy=0.16\displaystyle b_{xy} = 0.16.\n\n1. The coefficient of determination, r2\displaystyle r^2, represents the explained variation and is calculated as the product of the regression coefficients:\nr2=byxtimesbxy=4times0.16=0.64r^2 = b_{yx} \\times b_{xy} = 4 \\times 0.16 = 0.64\nThis corresponds to an explained variation of 64\displaystyle 64\\%.\n\n2. The percentage of unexplained variation is calculated as:\ntextUnexplainedVariation=1r2=10.64=0.36textor36\\text{Unexplained Variation} = 1 - r^2 = 1 - 0.64 = 0.36 \\text{ or } 36\\%\n\nThis matches Option B.\n\nHence, **Option B** is the correct answer.

About This Chapter: Correlation and Regression

Paper

Paper 3: Quantitative Aptitude

Weightage

4-6 Marks

Key Topics

Correlation Coefficient, Regression Equations

This chapter covers Correlation Coefficient, Regression Equations and is part of Paper 3: Quantitative Aptitude in the CA Foundation exam.

View Official ICAI Syllabus

Exam Strategy Tip

This topic carries 4-6 Marks weightage. Focus on understanding core concepts rather than memorizing.

Key Concepts to Understand

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