Question

Exercise 13-20 (LO13-3)

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				11				12.1
	2				8				10.5
	3				14				5.7
	4				17				4.9
	5				9				5.0
	6				8				13.4
	7				10				10.5
	8				14				9.0
	9				13				9.0
	10				17				4.5
	11				6				12.5
	12				6				11.5

1. Determine the regression equation. (Negative amounts should be indicated by a minus sign. Round your answers to 3 decimal places.)

2. Estimate the selling price of an 7-year-old car (in $000). (Round your answer to 3 decimal places.)

3. Interpret the regression equation (in dollars). (Round your answer to the nearest dollar amount.)

   Exercise 13-10 (LO13-2)

   A study of 8 worldwide financial institutions showed the correlation between their assets and pretax profit to be 0.75.

4. State the decision rule for 0.010 significance level: H₀: ρ ≤ 0; H₁: ρ > 0.

Answer 1