Reading 11- LOS F (Part 2): : Q3 following, correct, reports, style

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3．Which of the following reports the correct value and interpretation of the R² for this regression? The R² is:

A)   0.048, indicating that the variability of industry sales explains about 4.8 percent of the variability of company sales.

B)   0.952, indicating the variability of company sales explains about 95.2 percent of the variability of industry sales.

C)   0.048, indicating that the variability of company sales explains about 4.8 percent of the variability of industry sales.

D)   0.952, indicating that the variability of industry sales explains about 95.2 percent of the variability of company sales.

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The correct answer was D)

The R² = (SST - SSE)/SST = (12,500 - 600.50)/12,500 = 0.952

The interpretation of this R² is that 95.2% of the variation in company XYZ's sales is explained by the variation in tissue industry sales.