An economist investigated the association between a country's Literacy Rate and Gross Domestic Product (GDP) and used the association to draw the following conclusions. Explain why each statement is incorrect. (Assume that all the calculations were done properly.) a) The Literacy Rate determines 64% of the GDP for a country. b) The slope of the line shows that an increase of 5% in Literacy Rate will produce a $1 billion improvement in GDP. Question content area bottom Part 1 a) Choose the correct answer below. A. R2 is an indication of the appropriateness of the model. The model is 64% appropriate for Literacy Rate. B. R2 is the slope of the regression line. For each 1% in the Literacy Rate, the GDP increases by $640,000. C. R2 is an indication of the nonlinearity of the model. The model is 64% nonlinear for Literacy Rate. D. R2 measures the amount of variation explained by the model. Literacy Rate accounts for 64% of the Variability in GDP.
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