Question

31. The data set below shows the mileage and selling prices of eight used cars of the same model. Mileage Price 21,000 $16,000 34,000 $11,000 41,000 $13,000 43,000 $14,000 65,000 $10,000 72,000 $12,000 76,000 $7,000 84,000 $7,000 (a) Calculate r , the correlation coefficient between these two variables. r = (b) Interpret the value of r : the association is Select an answer and Select an answer (c) Compute the regression line for predicting price from mileage. ˆ y = x + (d) Predict the price of a car with 30,000 miles. $ (e) Does the student with 43,000 miles on it have a higher or lower price than the one predicted by the regression line? Higher Lower

Answer 1

we have that

using a Correlation Coefficient Calculator

Please wait a minute to calculate the correlation coefficient

The value of R is: 0.6775

This is a moderate positive correlation, which means there is a tendency for high X variable scores go with high Y variable scores (and vice versa

Part b

Is positive and moderate

Part c

using a Linear Regression Calculator

y= 0.13085X + 2.05929

Part d

For x=30,000 miles

substitute in the equation Part C

y= 0.13085*(30,000) + 2.05929

y=$3,927.56

Part e

For x=43,000 miles

substitute in the equation Part c

y= 0.13085*(43,000) + 2.05929

y=$5,628.61

Compare with the value of the given table

For x=43,000 miles -------> y=$14,000

therefore

5,628 < 14,000

the answer is Lower