Question

Given the data set, where X represents # clients (K) and Y represents value of stock portfolio (M)

X	3.4	4.2	5.0	5.2	4.6
Y	5.5	5.9	8.5	9.7	7.6

Use 3 decimal place accuracy

a. compute the correlation coefficient

b. slope of the regression equation

c. y-intercept

Answer 1

The statistical software output for this problem is :

Simple linear regression results:
Dependent Variable: y
Independent Variable: x
y = -2.89375 + 2.3066406 x
Sample size: 5
R (correlation coefficient) = 0.93772223
R-sq = 0.87932298
Estimate of error standard deviation: 0.70602873

Parameter estimates:

Parameter	Estimate	Std. Err.	Alternative	DF	T-Stat	P-value
Intercept	-2.89375	2.2326589	≠ 0	3	-1.2961004	0.2856
Slope	2.3066406	0.49335257	≠ 0	3	4.6754406	0.0185

a) The correlation coefficient = 0.937

b) slope of the regression equation = 2.306

c) y-intercept = -2.893