Positive correlation between ceo salary and the stock price


The salaries of the CEOs and the stock prices of 24 companies are shown in this scatterplot. A CEO uses this relation to argue there is a positive correlation between CEO salary and the Stock Price, and therefore, for the good sake of the company's stock value, his salary should be increased. Do you agree with his argument? Explain why or why not.

1308_Correlation between CEO salary and the Stock Price.png

Dr. Hanson's mother Sally and her sister Pat have a rivalry about who makes the better apple pie. Sally makes two pies and has 16 people selected at random from her church eat a piece of pie and rate her pies on a scale of 1-10. The 16 ratings are as follows: 6, 8, 3, 9, 9, 9, 8, 8, 6, 7, 8, 7, 6, 7, 6, 8. Her sister Pat had 15 randomly selected people try a piece of pie at her church and the ratings were:7, 3, 9, 9, 8, 6, 6, 6, 7, 4, 8, 6, 10, 2, 7.

1584_Correlation between CEO salary and the Stock Price1.png

 

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