Question

19) You are considering switching to become a finance major because someone told you it doesn't pay to help people. This person told you that there is a strong relationship between number of years employed at a financial institution and salary. This person provided the sample data below as evidence. Answer the following, showing all your work for plotting scores and working formulas. A) Is the relationship between years employed and salary linear? B) Write a hypothesis concerning the relationship of these two variables and test the correlation using the formula. Is the relationship strong? What is the direction of the relationship? C) Predict how much money you could be making after only 4 years using the regression formula. How much would you make after 7 years? How much after 1.5 years? Do not answer questions B and C by looking at your scatter plot, use the formulas. Create a professional looking scatter plot (remember to label your axes), don't take shortcuts. X - # of years Y-hourly wage $10 $13 $15 $25

Answer 1

Answer (a):  We have draw a scatter plot of the data on x and y axis from the graph it is clearely see that there exist a positive linear relationship between the variables that means as increasing X ,Y will also increase.

Answer (b): Now firstly find the correlation coefficient than test the significance of that

Answer (c): Now fit the regression model for the given data

Using the equation we get the earning after 4 , 7 and 1.5 yr

X(in yr)	Y(Hourlywage in $)=5.4571+3.7429*X
4	20.4
7	31.7
1.5	11.1