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    Crusty The Clown' Cereal

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    1. The sales of Crusty The Clown cereal since 2000 are:

    Year Code Sales
    ($ millions)
    2000 1 5
    2001 2 7
    2002 3 6
    2003 4 10
    2004 5 12

    What is the sales forecast for 2005?

    2. The owner of a car dealership wants to determine whether there is a relation between the income level and the type of vehicle purchased in their dealership. He randomly sampled 500 car buyers and obtained the following data:

    Income Level SUV/Minivan Midsize Compact
    up to $30K/yr 13 71 106
    $30K-$60K 33 76 45
    more than $60K/yr 66 59 31

    At the .05 level of significance, determine whether there is a relation between the income level and the type of vehicle purchased. Show your work step by step.

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    Solution Preview

    ** Please see the attached file for the complete solution response **

    1.  The sales of Crusty the Clown cereal since 2000 are:
    (please see the attached file)
    What is the sales forecast for 2005?

    Solution: Let's assume that there is some pattern in the sales (as from the data it seems that growth of sales with respect to years is not linearly related.

    So, we go by some pattern like

    2000 5
    2001 7 (As 5, 7 follows 6.)
    2002 6

    Then we have
    2003 10
    2004 12 (similarly, 10, 12 follows 11.)
    2005 11

    Hence the sales forecast for year ...

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