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Michelle Robertson Section 2
Investigation 10  Used Car Prices
Megan Marques Section 1
December 1, 2006
Stat 221
a.
The least squares line is price (k) = 187851397(age)
age
Price
14
12
10
8
6
4
2
0
25000
20000
15000
10000
5000
0
S
2295.21
RSq
67.3%
RSq(adj)
66.9%
Fitted Line Plot
Price = 18785  1397 age
b.
The proportion of variability is .673.
c.
Ho: ß ≠ 0
( no relation )
Ha: ß = 0
( relationship )
T=
b
T =
1397
= 13.446
Degrees of Freedom =
902=88
Pvalue = 0.00
SEb
103.9
We have very strong evidence against the null hypothesis (Ho).
There is strong evidence
that ß is = 0 meaning that there is a relationship.
This means that there is a relationship
between the price and the age of the car.
Older cars will cost less and newer cars will
cost more.
d.
b +/ t*(SEb) = 1397 +/ (2.00)(103.9) = (1604.8 – 1189.2)
This parameter and interval mean that for each additional year old the car is the price of
the car decreases by between $1604.8 and $1189.2.
e.
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This note was uploaded on 04/14/2008 for the course STAT 221 taught by Professor Lund during the Spring '05 term at Cal Poly.
 Spring '05
 Lund
 Least Squares, Probability

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