Business Statistics: Chapter 14
1)
Given are five observations for two variables,
x
and
y
.
x
i
1
2
3
4
5
y
i
3
7
5
11
14
a.
Which of the following scatter diagrams accurately represents the
data?
1.
2.

3.
SelectScatter diagram #1Scatter diagram #2Scatter diagram #3Item 1
b.
What does the scatter diagram indicate about the relationship between
the two variables?
Select
There appears to be a linear relationship between x and y
c.
Develop the estimated regression equation by computing the the slope
and the
y
intercept of the estimated regression line (to 1 decimal).
Y= .2 + 2.6x

d.
Use the estimated regression equation to predict the value
of
y
when
x
= 4 (to 1 decimal).
=
10.6
2)
Given are five observations collected in a regression study on two
variables.
Excel file:
data14-03.xls
a.
Which of the following scatter diagrams accurately represents the
data?
Scatter diagram #1
Scatter diagram #2

Scatter diagram #3
- Select your answer
Scatter diagram #1
b.
Compute
b
0
and
b
1
(to 1 decimal).
b
1
.9
b
0
7.6
Complete the estimated regression equation (to 1 decimal).
= +
x
y= 7.6 + .9x

c.
Use the estimated regression equation to predict the value
of
y
when
x
= 6 (to 1 decimal).
=
Y=13

2)
Brawdy Plastics, Inc., produces plastic seat belt retainers for
General Motors at their plant in Buffalo, New York. After final assembly
and painting, the parts are placed on a conveyor belt that moves the
parts past a final inspection station. How fast the parts move past the
final inspection station depends upon the line speed of the conveyor
belt (feet per minute). Although faster line speeds are desirable,
management is concerned that increasing the line speed too much
may not provide enough time for inspectors to identify which parts are
actually defective. To test this theory, Brawdy Plastics conducted an
experiment in which the same batch of parts, with a known number of
defective parts, was inspected using a variety of line speeds. The
following data were collected.
Excel file:
data14-05.xls
If required, enter negative values as negative numbers.

a.
Select a scatter diagram with the line speed as the independent
variable.
Scatter diagram 1

b.
What does the scatter diagram developed in part (a) indicate
about the relationship between the two variables?
negative
it is negative because the x variable is negative, therefore
negative slope
c.
Use the least squares method to develop the estimated
regression equation (to 1 decimal).
Y= 27.5 + -0.3x
I got this on my ti-84 by adding all information in L1 L2
then calculate, 8:linreg(a+bx)
d.
Predict the number of defective parts found for a line speed of 25
feet per minute.
27.5 -0.3(25) =20
=20

3)
Companies in the U.S. car rental market vary greatly in terms of the
size of the fleet, the number of locations, and annual revenue. In 2011
Hertz had 320,000 cars in service and annual revenue of
approximately $4.2 billion. The following data show the number of cars
in service (1000s) and the annual revenue ($millions) for six smaller
car rental companies (
Auto Rental News
website, August 7, 2012).

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