Question

Hello! So I need to do this on simple linear regression. I also need to find the coefficient of correlation, a, b0 and b1. Right now I only have the variables. which are:
personal cosumption expenses - 67,726.3
personal income- 64,275.9

Answer 1

(a)

From the given data, the following Table is calculated:

X	Y	XY	X2	Y2
67	64	4288	4489	4096
726.9	275.9	200386.12	527511.69	76120.81
Total = 793.3	339.9	204674.17	532000.69	80216.81

The intercept b0 is got as follows:

The slope b1 is got as follows:

So,

the Simple Linear Regression is given by:

y = 42.466 + 0.321 x

b0 = 42.466

b1 = 0.321

(b)
The correlation coefficient r is got as follows:

So,

r = 1