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 10 8.3
2 7 6.9
3 14 1.4
4 18 2.4
5 8 6.8
6 8 9.4
7 8 7.5
8 15 5.6
9 13 5.6
10 18 3.1
11 6 9.4
12 6 7.6
  1. Determine the regression equation. (Negative amounts should be indicated by a minus sign. Round your answers to 3 decimal places.)

  1. Estimate the selling price of an 10-year-old car (in $000). (Round your answer to 3 decimal places.)

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

Homework Answers

Answer #1

( a )

( b ) Given x = 10 then

y = 121.079 − 0.884 ( 10 )

then

y = 112.239

( c )

The slope indicates that every​ 1-year increase in Age decreases the Price of cars of this model by 0.884, on average.

The​ y-intercept means that a new car of this model costs 121.079 on average.

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