Question

4. A friend is planning to sell her used Honda so she gathers data on prices (in

thousands of dollars) and year (let 79 represent 1979) for eleven cars similar to
hers. A scatterplot of the data is shown. The linear regression equation for these
data has the equation: price=0.735-year-59.5. Your friend's Honda is a 1988. Use
the regression model to establish a selling price for her car.
10
6
Price (thousand $)
4
2
78 80 82 84 86 88 90 92 94
Year
price = 0.735 . year – 59.5; r2 = 0.87

Answer 1

To determine the selling price for the 1988 Honda using the regression model, substitute 88 into the equation price = 0.735 × year − 59.5 to get a price of $5,180.

Step-by-step explanation:

To establish the selling price for the friend's 1988 Honda using the linear regression model, plug the year of the car into the equation price = 0.735 × year − 59.5. Since the year is represented by 88 (letting 79 represent 1979), we substitute 88 in place of the year in the equation and calculate the price in thousands of dollars.

Calculating the price: price = 0.735 × 88 − 59.5 = 64.68 − 59.5 = 5.18. So, the selling price determined by the regression model for the 1988 Honda is $5,180.