Question

NOTE: you might be able to get all the necessary information from the Excel analysis output or the scatter plot. You don’t need to do computations by applying the numeric formula.

A clothing department wants to find out if there is a relationship (and what kind of relationship) between the price of an item and the time that it takes to a customer to decide in buying that item.

ITEM PRICE (X)	DECISION TIME IN MINUTES (Y)
$17	9
$63	15
$140	20
$250	30
$10	4
$8	5
$170	27
$280	30

1. Using Excel construct a scatter plot. Discuss the output of the scatter plot.
2. Give (or calculate) the correlation coefficient.
3. Give (or calculate) the coefficient of determination.
4. Give (or calculate) the regression equation coefficients; Give the equation of regression.

e. (very important)

Based on the above values, in detail draw the conclusion:

• Discuss the correlation coefficient r
• Discuss the coefficient of determination r²
• Discuss in detail the meaning of the regression equation

f. (unrelated to previous data)

A company has a set of data with employee age (X) and the corresponding number of annual on-the-job-accidents.

Analysis on the set finds that the regression equation is Y= 110-3.78X.

• What can be said of the correspondence between age and accidents?
• Are younger workers safer or more prone to accident?
• What is the likely number of accidents for someone of 23 years old?

Answer 1