By how much has the stock price increased or decreased (per year) on average dur

Question

By how much has the stock price increased or decreased (per year) on average during the period? (Round your answer to 2 decimal places.)

Listed below is the selling price for a share of PepsiCo Inc. at the close of each year from 1990 to 2012. Listed below is the selling price for a share of PepsiCo Inc. at the close of each year from 1990 to 2012. Year Price Year Price Year Price Year Price 1990 12.9135 1996 29.0581 2002 42.2200 2008 54.7700 1991 16.8250 1997 36.0155 2003 46.6200 2009 60.8000 1992 20.6125 1998 40.6111 2004 52.2000 2010 65.3300 1993 20.3024 1999 35.0230 2005 59.8500 2011 66.3500 1994 18.3160 2000 49.5625 2006 62.0000 2012 68.4300 1995 27.7538 2001 48.6800 2007 77.5100 b. Determine the least squares trend equation. (Round your answers to 2 decimal places.) Y hat = _____. e. By how much has the stock price increased or decreased (per year) on average during the period? (Round your answer to 2 decimal places.) (Click to select)IncreasedDecreased $ _____ per year Y hat=_____ d. Estimate the selling price in 2016. (Round your answer to 2 decimal places.) For 2016, Y hat =_____ and for 2000, Ya hat = _____+ _____t c. Calculate the selling price for the years 1995 and 2000. (Round your answers to 2 decimal places.) For 1995,

Explanation / Answer

Let us assume year as independent variable and 1990 as year 1

The equation of the regression line is:

y = 12.012 + 2.665?x

We will find an equation of the regression line in 4 steps.

Step 1: Find X?Y and X2 as it was done in the table below.

Step 2: Find the sum of every column:

?X=276 , ?Y=1011.7534 , ?X?Y=14837.7915 , ?X2=4324

Step 3: Use the following equations to find a and b:

ab=?Y??X2??X??XYn??X2?(?X)2=1011.7534?4324?276?14837.791523?4324?2762?12.012=n??XY??X??Yn??X2?(?X)2=23?14837.7915?276?1011.753423?4324?(276)2?2.665

Step 4: Substitute a and b in regression equation formula

------------------------------------------

c) For 1995, x = 5

y = 12.012+2.665(5) = 25.325

for 2000 x =10

y = 38.662

d) in 2016 x = 26

y = 81.29

e) Average increase = 68.43-12.9135/23

= 2.41376

X Y X?Y X?X 1 12.9135 12.9135 1 2 16.825 33.65 4 3 20.6125 61.8375 9 4 20.3024 81.2096 16 5 18.316 91.58 25 6 27.7538 166.5228 36 7 29.0581 203.4067 49 8 36.0155 288.124 64 9 40.6111 365.4999 81 10 35.023 350.23 100 11 49.5625 545.1875 121 12 48.68 584.16 144 13 42.22 548.86 169 14 46.62 652.68 196 15 52.2 783 225 16 59.85 957.6 256 17 62 1054 289 18 77.51 1395.18 324 19 54.77 1040.63 361 20 60.8 1216 400 21 65.33 1371.93 441 22 66.35 1459.7 484 23 68.43 1573.89 529

Related Questions

Navigate

• Browse (All)
• Browse B
• Subjects

---

---

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