Question

Consider the following statements:
1. Both the regression coefficients have same sign.
2. If one of the regression coefficients is greater than unity, the other must be less than unity.
Which of the above statements is/are correct?

• A. 1 only
• B. 2 only
• C. Both 1 and 2
• D. Neither 1 nor 2

Answer 1

The correct option is C Both 1 and 2

1. The sign of both the regression coefficients will be same, i.e. they will be either positive or negative. Thus, it is not possible that one regression coefficient is negative while the other is positive.
2. The value of the coefficient of correlation cannot exceed unity. Therefore, if one of the regression coefficients is greater than unity, the other must be less than unity.