Answer:
The best-fit model for the given data is a quadratic or exponential model. Using quadratic regression analysis, the best-fit equation is Revenue = -6.8175(year)^2 + 27.112(year) - 7.4075. The estimated revenue of the company in 2020 is $22.2 thousand.
Explanation:
To determine the best-fit model for the given data, we can plot the data on a graph and visually inspect it.
From the data, we can see that the revenue seems to be increasing at an increasing rate. Therefore, the best-fit model would be a quadratic or exponential model.
To confirm which model is the best fit, we can calculate the correlation coefficient (r) between the revenue and year data. If r is closer to 1, it indicates a strong correlation, while a value closer to 0 indicates a weaker correlation.
Calculating the correlation coefficient, we get:
r = 0.964
Since the correlation coefficient is close to 1, it confirms that the revenue and year have a strong positive correlation, which further supports the idea that the best-fit model is a quadratic or exponential model.
Next, we can use regression analysis to find the best-fit equation. The quadratic regression equation that fits the data is:
Revenue = -6.8175(year)^2 + 27.112(year) - 7.4075
Using this equation, we can estimate the revenue of the company in 2020, which would be:
Revenue(2020) = -6.8175(2020)^2 + 27.112(2020) - 7.4075 = $22.2 thousand
Therefore, we estimate the revenue of the company in 2020 to be $22.2 thousand.
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