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Instruction. Please use excel to answer the following problems.

Present your
solution and your answers in MS Word. (Copy the result of the excel in MS Word)

1. You have to examine the relationship between the age and price for used cars sold in the
last year by a car dealership company.

Here is the table of the data:

Car Age (in Year) Price (In Hundred Thousands)


4 315
4 290
5 285
5 225
7 225
7 210
8 205
9 155
10 105
4 300
3 309

a. Determine the degree of relationship between in car’s age and the price.
b. Identify the equation of linear regression.
c. How much will a car worth after 6 years? 12 years? 15 years?
d. Explain the predicting capability of the equation.

2. With the growth of internet service providers, a researcher decides to examine


whether there is a correlation between cost of internet service per month (rounded to
the nearest dollar) and degree of customer satisfaction (on a scale of 1 - 10 with a 1
being not at all satisfied and a 10 being extremely satisfied). The researcher only includes
programs with comparable types of services. A sample of the data is provided below.
dollars satisfaction
11 6
18 8
17 10
15 4
9 9
5 6
12 3
19 5
22 2
25 10

a. Compute the correlation coefficient.


b. Determine the equation of regression if the level of satisfaction is being
predicted.
c. What satisfaction level would the customers achieved if they are paying $20?
$8? $16?
d. Determine the equation of regression if the cost is being predicted.
e. How much would it cost to have a satisfaction level of 7?
f. Explain the predicting capability of the equation.

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