Question

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				9				10.5
	2				6				8.6
	3				12				3.1
	4				14				3.0
	5				7				7.0
	6				7				11.4
	7				7				8.2
	8				12				6.9
	9				12				6.9
	10				14				2.1
	11				5				9.6
	12				5				8.5

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

2. Estimate the selling price of an 11-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.)

Answer 1

( a )

y = 13.477 + ( -0.690 ) x

( b )

Given x = 11 then

y = 13.477 - 0.690 ( 11 )

y = 5.887

( c )

slope indicates that every​ 1-year increase in Age decreases the Price of cars of this model by ​$
0.69 on average.

​ y-intercept means that a new car of this model costs ​$13.477 on average