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Unformatted text preview: ent variable). Answer: TRUE Diff: 1 Terms: coefficient of determination (r2), regression analysis Objective: A AACSB: Reflective thinking 59) Generally a coefficient of determination (r2) that is less than 0.30 indicates a goodness of fit. Answer: FALSE Explanation: Generally a coefficient of determination (r2) that is 0.30 or higher indicates a goodness of fit. Diff: 2 Terms: coefficient of determination (r2), regression analysis Objective: A AACSB: Reflective thinking 60) Multicolli nearity is NOT a concern in simple regression. Answer: TRUE Diff: 2 Terms: simple regression, multicollinearity Objective: A AACSB: Reflective thinking 61) Multicolli nearity exists in multiple regression when two or more independent variables are highly correlated with each other. Answer: TRUE Diff: 2 Terms: multiple regression, multicollinearity Objective: A AACSB: Reflective thinking 62) Which of the following statements related to assumptions about estimating linear cost functions is FALSE? A) Variations in a single cost driver explain variations in total costs. B) A cost object is anything for which a separate measurement of costs is desired. C) A linear function approximates cost behavior within the relevant range of the cost driver. D) A high correlation between two variables ensures that a cause-and-effect relationship exists. Answer: D Diff: 2 Terms: cost estimation, linear cost function Objective: 1 AACSB: Reflective thinking 63) A high correlation between two variables s and t indicates that: A) s may cause t, or t may cause s B) both may be affected by a third variable C) the correlation may be due to random chance D) All of these answers are correct. Answer: D Diff: 2 Terms: cost function Objective: 2 AACSB: Reflective thinking 64) Which of the following does NOT represent a cause-and-effect relationship? A) Material costs increase as the number of units produced increases. B) A company is charged 40 cents for each brochure printed and mailed. C) Utility costs increase at the sa...
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This note was uploaded on 12/12/2012 for the course SB 305 taught by Professor Brown during the Spring '08 term at Clarkson University .

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