An auto manufacturing company wanted to investigate how the price of one of its

Question

An auto manufacturing company wanted to investigate how the price of one of its car models depreciates with age. The research department at the company took a sample of eight cars of this model and collected the following information on the ages (in years) and prices (in hundreds of dollars) of these cars.

Find the least squares regression line equation in the form y^=a+bx. Use "Age" as the independent variable and "Price" as the dependent variable.

Round your answers to four decimal places.

Predict the price of a 3 year-old car of this model

Round your answer to one decimal place.

ypred=______

An auto manufacturing company wanted to investigate how the price of one of its car models depreciates with age. The research department at the company took a sample of eight cars of this model and collected the following information on the ages (in years) and prices (in hundreds of dollars) of these cars.

Age 7 8 4 7 5 5 7 4 Price 27 ,37, 61, 45, 58, 62, 31, 67

Explanation / Answer

x = price and y = Age

By using excel we can solve this question.

First, enter data into excel.

Regression equation is    = a + bx

Here a is intercept and b is the slope.

We have to find values of a and b.

For finding value of 'a' use excel command =INTERCEPT(select y values , select x values)

We get a = 10.2095

For finding value of b use excel command =SLOPE(select y values , select x values)

We get b = - 0.0894

So regression equation is = 10.2095 - 0.0894*x

Related Questions

Navigate

• Browse (All)
• Browse A
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.