Strongest Correlation Values | CFA® Level 1 Exam | Test Prep

Strongest Correlation Values

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Question

Which value of r indicates the strongest correlation than 0.40?

Answers

Explanations

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A. B. C. D. E.

B

The bigger the absolute value of r, the stronger the correlation. The sign +/- just shows the direction, not the strength.

To determine which value of r indicates a stronger correlation than 0.40, we need to understand that the correlation coefficient (r) measures the strength and direction of the linear relationship between two variables. The value of r ranges from -1 to +1, where -1 represents a perfect negative correlation, +1 represents a perfect positive correlation, and 0 indicates no correlation.

In this case, we are looking for a value of r that is stronger than 0.40, which means it needs to be closer to +1 or -1. Let's analyze each answer choice:

A. +0.48: This value indicates a positive correlation, and it is stronger than 0.40 because it is closer to +1.

B. -0.50: This value indicates a negative correlation, and it is stronger than 0.40 because it is closer to -1.

C. 0: This value indicates no correlation, which means there is no linear relationship between the variables. It is weaker than 0.40 since it suggests no association.

D. -0.30: This value indicates a negative correlation, but it is weaker than 0.40 because it is further from -1.

Based on the analysis above, both options A and B represent values that indicate stronger correlations than 0.40. Therefore, the correct answer is E. None of these answers, as more than one option meets the criteria.