Question

# The owner of Maumee Ford-Volvo wants to study the relationship between the age of a car...

The owner of Maumee Ford-Volvo wants to study the relationship between the age of a car and its selling price. Listed below is a random sample of 12 used cars sold at the dealership during the last year.

 Car Age (Years) Selling Price (\$000) 1 12 10.3 2 10 9.2 3 15 4.6 4 18 4.2 5 12 5.1 6 10 11.6 7 12 8.0 8 16 7.8 9 14 7.8 10 18 4.3 11 8 10.0 12 8 8.8

a) Determine the regression equation

 a= b=

b) Estimate the selling price of a 13-year-old car (in \$000)

c) Interpret the regression equation (in dollars).

a)

 X Y X⋅Y X⋅X 12 10.3 123.6 144 10 9.2 92 100 15 4.6 69 225 18 4.2 75.6 324 12 5.1 61.2 144 10 11.6 116 100 12 8 96 144 16 7.8 124.8 256 14 7.8 109.2 196 18 4.3 77.4 324 8 10 80 64 8 8.8 70.4 64

a = 14.667

b = - 0 .551

b) x = 13

y = 14.667 - 0.551 ( 13 )

= 7.504

c) Slope : each additional year, selling price decreased by 0.551

Intercept : selling price is 14,667 at 0th year .