A sample of 33 companies was randomly selected and data collected on the average
ID: 3331086 • Letter: A
Question
A sample of 33 companies was randomly selected and data collected on the average annual bonus, turnover rate (%), and trust index (measured on a scale of 0-100). The regression coefficient associated with Average Bonus was found to be 0.0007216. What is the interpretation of this value?
A. An increase of $100 in the average annual bonus decreases the turnover rate by 7.2%.
B. Holding the trust index constant, increasing the average annual bonus by $100 will decrease the turnover rate by 7.2%.
C. For companies that have the same score on the trust index, increasing the average annual bonus by $100 is associated with an increase in turnover rate of 7.2%, on average.
D. For companies that have the same score on the trust index, increasing the average annual bonus by $100 is associated with a decrease in turnover rate of 7.2%, on average.
Explanation / Answer
The interpretation of this value will be:
For companies that have the same score on the trust index, increasing the average annual bonus by $100 is associated with a decrease in turnover rate of 7.2%, on average.
Option D is correct.