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Statistics

1. A study is being undertaken of companies going public. Of particular interest is the relationship between the size of the offering and the price per share. A sample of ten companies that recently went public revealed:

Size Price
(millions) Per Share
Company X Y X2 XY
1 9.0 15.8 81.00 142.20
2 94.4 11.3 8,911.36 1,066.72
3 27.3 13.2 745.29 360.36
4 179.2 10.1 32,112.64 1,809.92
5 71.9 11.1 5,169.61 798.09
6 97.9 11.0 9,584.41 1,076.90
7 93.5 10.9 8,742.25 1,019.15
8 70.0 11.7 4,900.00 819.00
9 160.7 10.3 25,824.49 1,655.21
10 96.5 11.6 9,312.25 1,119.40

Total: 900.4 117.0 105,383.3 9,866.95

a. Determine the regression equation (show your work).

ROW X SQUARED?

b. What does the slope of the regression equation tell us?

10?

c. What would you predict the price per share to be if 95 million shares were offered?

WHAT IS THE FORMULA FOR THIS?

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Solution Summary

The solution does a good job of explaining the several Statistics concepts listed. The solutions (in the attachment) are well explained and can be easily followed along by anyone with a basic understanding of the topic. Overall, an excellent response to the question being asked.

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