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7. Do heavier cars really use more gasoline? Suppose a car is chosen at random. Let x be the weight of the car (in hundreds o

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a) We are claiming that heavier cars use more gasoline, i.e. the correlation between weight and gasoline usage is positive, or in other words, the correlation between weight and miles per gallon is negative.

H0: \rho >= 0

H1: \rho < 0 (this is the original claim)

b) Correlation coefficient can be calculated using the CORREL() function in Excel and comes out to be:

r = -0.147

c) P-value for r = -0.147 and n=8 is

P = 0.728

Since, P > 0.05

We cannot reject the null hypothesis at the 0.05 significance level.

d) Hence, the original claim that heavier cars use more gasoline is not significant at the 5% significance level.

e) Running regression on X vs Y in Excel (go to Data tab -> Data Analysis -> Regression, choosing X and X-column and Y as Y-column), we get the following output:

Coefficients Standard Error t Stat P-value Lower 95% Upper 95%
Intercept 28.26809651 9.594245321 2.94635957 0.02573426 4.791823937 51.74436909
X -0.090482574 0.247763646 -0.36519713 0.72749221 -0.696738376 0.515773229

Hence, the equation of best-fit regression line is:

Y = - 0.905 * X + 28.268

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