Compensation (millions of dollars) 
Stock Return (%) 


26.81 
5.58  
12.82 
30.26  
19.64 
31.47  
13.14 
79.88 

12.37 
8.24  
12.07 
2.82  
25.87 
4.39  
14.86 
10.88  
17.16 
4.26  
14.63 
11.98 
The given data represent the total compensation for 10 randomly selected CEOs and their company's stock performance in 2009. Analysis of this data reveals a correlation coefficient of
requals=negative 0.2209−0.2209.
What would be the predicted stock return for a company whose CEO made $25 million?
From the provided information, the table can be made as:
The slope and intercept can be obtained as:
The equation of regression line is as follow:
For a company whose CEO made $25 million the stock return can
be calculated as:
Thus, the stock return is 9.15%.
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