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# A retailer wanted to estimate the monthly fixed and variable selling expenses. As a first step she collected data from the past 8 months and recorded...

A retailer wanted to estimate the monthly fixed and variable selling expenses. As a first step she collected data from the past 8 months and recorded it in Xr04-57. The total selling expenses in (\$thousand) and the total sales in (\$thousands) are shown below:

Total Sales

Selling Expenses

20

14

40

16

60

18

50

17

50

18

55

18

60

18

70

20

a) Compute the covariance and the coefficient of determination and describe what these statistics mean.
b) Determine the least squares line and use it to produce the estimates the retailer wants.

sales(X)
20
40
60
50
50
55
60
70
50.625 expenses (Y)
14
16
18
17
18
18
18
20 (x-xmean )*(y-ymean)
103.359375
14.609375
5.859375
0.234375
-0.390625
2.734375
5.859375
50.859375 17.375
22.890625...

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