Mr. William Profit is studying companies going public for the first time. He is particularly interested
in the relationship between the size of the offering and the price per share. A sample
of 15 companies that recently went public revealed the following information.
(see the attached chart)
a. Determine the regression equation.
b. Determine the coefficient of determination. Do you think Mr. Profit should be satisfied
with using the size of the offering as the independent variable?
Please see the attached file. (Tables etc may not be clearly visible here)
Company Size ($millions), per Share, X Price ($millions), per Share, ...
Solution Summary
Solution explains the steps in finding the regression equation between size of offering and price of share. Solution also makes use of coefficient of correlation and determination to coclude whether size of offering as independent variable is justified.
The test scores of 6 randomly picked students and the numbers of hours they prepared are as follows:
Hours: 5 10 4 6 10 9
Score: 64 86 69 86 59 87
The equation of the regression line is y(^on top)=1.06604x+67.3491. Find the coefficient of determination.
The coefficient of correlation was computed to be -0.60. This means
a. the coefficient of determination is .
b. as X increase Y decreases.
c. X and Y are both 0.
d. as X decreases Y decreases.
Which of the following is a stronger
Question 1
Show us a scatterplot between two interval level variables. (Use Excel to chart them.) Are the results bunched together or far apart? Is the relationship linear? Is the relationship non-linear? Is there no apparent relationship between the two variables?
Question 2
We use Pearson's correlation coefficie
Data from a study of 534 U.S. workers from 1985 includes information about each worker's hourly wage (measured in U.S. dollars/hour) and age (measured in years). First, linear regression is performed to estimate the relationship between hourly wage and age (years), and the resulting slope of age is 0.08, andcorrelation coeffici
The following regression equation was computed from a sample of 20 observations:
Y' = 15 - 5X
SSE was found to be 100 and SS total 400.
a) Determine the standard error of estimate.
b) Determine the coefficient of determination.
c) Determine the coefficient of correlation.
The Cadet is a popular model of sport utility vehicle, known for its relatively high resale value. The bivariate data given below were taken from a sample of sixteen Cadets, each bought "new" two years ago and each sold "used" within the past month. For each Cadet in the sample, we have listed both the mileage, x (in thousands
The following information regarding a dependent variable Y and an independent variable X is provided.
EX = 16 E (X - X)(Y - Y) = -8
EY = 28 E (X - X)2 = 8
n = 4 SST = 42
SSE = 34
The coefficient of determination is
A. 0.1905
B. -0.1905
C. 0.4364
D. -0.4364
The coefficient of correlatio
