Question

Question 2 - of 24 Step 5 of 6 02:19:07 The table below gives the list price and the number of bids received for five randomly selected items sold through online auctions. Using this data. consider the equation of the regression line 9 = bo + bix. for predicting the number of bids an item will receive based on the list price. Keep in mind, the correlation coefficient may or may not be statistically significant for the data given. Remember, in practice, it would not be appropriate to use the regression line to make a prediction if the correlation coefficient is not statistically significant Price in Dollars 23 25 28 43 44 Number of Bids 2 4 6 8 9 Table Copy Data < rev Step 5 of 6: According to the estimated linear model, if the value of the independent variable is increased by one unit, then the change in the dependent variable ŷ is given by?

Answer 1

Solution: The data given in the question statement is as below. Computing additional columns: Price in Dollars Number of Bids (x - x) (y-7) (x - 1)(y-7) X у 23 2 -9.6 -3.8 36.48 25 4 -7.6 -1.8 13.68 (x – x)2 92.16 57.76 28 6 -4.6 0.2 -0.92 21.16 43 8 10.4 2.2 22.88 108.16 44 9 11.4 3.2 { x=163 36.48 (x – 7)(y-7)= 108.60 129.96 2(x - 2)2 = 409.20 Ey=29 Σχ 163 x= 32.6 n 5 29 Σy y = = 5.8 n 5 The regression equation is of the form: û = bo + byx bi = 2(x - x)(y – 5) {(x – 2)2 108.60 = 0.265 409.20 b) = y- b x = 5.8 - (0.265 x 32.6) = -2.852 Hence, the regression equation is: û = -2.852 + 0.265x If the value of the independent variable is increased by 1 unit, then the change in the dependent variable is given by 0.265