Chapter 12, Problem 95CP

Multiple choice: Interpret r One can interpret r = 0.30 or the corresponding r² = 0.09 as follows:

1. a. A 30% reduction in error occurs in using x to predict y.
2. b. A 9% reduction in error occurs in using x to predict y compared to using $\bar{y}$ to predict y.
3. c. 9% of the time $\hat{y}=y$.
4. d. y changes 0.3 unit for every one-unit increase in x.
5. e. x changes 0.3 standard deviations when y changes 1 standard deviation.