9. The following minitab computer print out shows income. The simple linear mode

Question

9. The following minitab computer print out shows income. The simple linear model E(y) ?0 + ?1x1 wa printouts for the analysis are given below: a linear regression Analysis for cost and s fit to the data . Computer Regression Analysis: Cost versus Income The regreasion equation ia Ca??-439 + 0.511 Income Predictor Coef SE Coef Constent 430.525 3.341 131.25 0.000 Iacome 0.51145 0.02325 22.00 .000 a) Give a practical interpretation of the estimate of the y-intercept of the least squares line. If none exist explain why. b) Give a practical interpretation of the slope of the least squares line. If none exists explain why. 91 C) Give a practical interpretation of R2 d) Find r

Explanation / Answer

Solution:
Regression equation is
Cost= 439 + 0.51145 * Income

Solution(1):

Intercept of line is the expecting value of Y when X=0
Here When Income = 0 than cost would be 439.
Solution(2):
Slope of the regression line is 0.51145
Slope of the line tells thay if value of X is increase or decrease by 1 unit than value of cost would also increase or decrease by 0.51145unit.
Solurion(3)
Coefficient of determination = 0.91
Here we can see that if R2 is 0.91 which means that this model explains 91% variability in Cost.
Solution(4):
r can be calculated = square root of coeficient of deterination = sqt(0.91) = 0.953939

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