The data on profit and market capitalization for a sample of 15 different firms in the Philippines are as below.

Profits (Php millions) y Market Capitalization ($ millions) x

296.2 1936.9
-25 1171.8
4085 55135.8
6558 97417.2
12525 95198.9
3394 53579.7
442.8 12466.3
633.1 8894.3
3528 65872.4
2698 25661.3
1200.65 19854.7
11.987 195643.8
641.8 10447.8
5043 66695.5
5206 53558.4

a. Develop a scatter chart for the above data. What does this chart indicate about the relationship between market capitalizati

Profits (Php millions) y

The relationship between the 2
14000 profit, the change affects the m
12000
10000
8000
Profit

6000 Profits (Php millions) y

4000
2000
0
0 50000 100000 150000 200000 250000
-2000

Capital Capitalization
b. Use the data to develop an estimated regression equation that could be used to estimate a firm’s profit based on its market
SUMMARY OUTPUT

Regression Statistics
Multiple R 0.347657228662627
R Square 0.120865548641378
Adjusted R Square 0.053239821613792
Standard Error 3293.04264101756
Observations 15

ANOVA
df SS MS
Regression 1 19381406.4517 19381406.4517
Residual 13 140973687.8623 10844129.83556
Total 14 160355094.314

Coefficients Standard Error t Stat

Intercept 1916.48727458133 1218.087321076 1.57335787133
Market Capitalization ($ millions) x 0.022908226162423 0.017135475949 1.336888816575

c. What is the predicted profit for the market capitalization of 70721.3 (Php million)?
The predicted profit for the market capitaliation is Zero

Y 3536.58680948186
3536.59

If the market capitalization is 70,721.30 the predicted profit would be 3536.59.

between market capitalization and profit?

elationship between the 2 variables is that whenever there is a change in

the change affects the market capitalization and vice versa.
s profit based on its market capitalization. What is the estimated regression model?

F Significance F
1.787271707882 0.204184155375

P-value Lower 95% Upper 95% Lower 95.0% Upper 95.0%

0.139649118669 -715.030394705 4548.004943868 -715.030394705 4548.004943868
0.204184155375 -0.01411071899 0.059927171315 -0.01411071899 0.059927171315

rofit would be 3536.59.

A survey is conducted to determine whether the age of car influences the annual maintenance cost. A sample of 10 cars is sele

Age of car (months) x Annual Maintenance Cost ($) y

3 120
5 115
6 135
7 290
9 275
10 300
11 350
13 475
14 500
15 550

a. Develop a scatter chart for these data with age of cars as the independent variable. What does the scatter chart indicate ab

Survey on Car influence the annual maintenace

600

500
Abbua Maintenacne

400

300 Column B

200

100

0
2 4 6 8 10 12 14 16

Age of Car

b. Use the data to develop an estimated regression equation that could be used to predict the annual maintenance cost given
SUMMARY OUTPUT

Regression Statistics
Multiple R 0.968522552604913
R Square 0.938035934904336
Adjusted R Square 0.930290426767379
Standard Error 42.1146519430233
Observations 10
ANOVA
df SS MS
Regression 1 214800.8487337 214800.8487337
Residual 8 14189.15126626 1773.643908282
Total 9 228990

Coefficients Standard Error t Stat

Intercept -45.5954825462013 35.03351276441 -1.301481894
Age of car (months) x 38.3436002737851 3.484240365697 11.00486655607

c. What is the predicted annual maintenance cost for a 24 months old car?
Y= 874.650924024641
874.65

The predicted annual maintenance cost for 24 months old is 874.65

 enance cost. A sample of 10 cars is selected and the data is shown below.

What does the scatter chart indicate about the relationship between age of a car and the annual maintenance cost?

annual maintenace

The higher the profit, the more costly the maintenance is.
Column B

12 14 16

ict the annual maintenance cost given the age of the car. What is the estimated regression model?
 F Significance F
121.107087917 4.13500645E-06

P-value Lower 95% Upper 95% Lower 95.0% Upper 95.0%

0.229320255047 -126.382907852 35.19194275925 -126.382907852 35.19194275925
4.13500645E-06 30.30892758244 46.37827296513 30.30892758244 46.37827296513

onths old is 874.65

A researcher wanted to study effect of two factors, x1 and x2, on yield (y). The observations are given below.

Observations x1 x2 y
1 42.5 30.1 260.4
2 43.5 29.3 261.7
3 43.9 31.1 273.6
4 44.8 29.6 278.6
5 46.8 29.7 281.5
6 47.5 29.9 294.6
7 50.1 30.1 301.2
8 51.9 30.4 314.6
9 54.7 30.5 320.5
10 54.8 31 324.7
11 57.1 31.8 356.7
12 57.8 31.4 370.3
13 62.3 31.5 378
14 66.7 32.1 384.8
15 71.2 32.5 396.9

a. Develop an estimated regression equation with both factors x1 and x2 as the independent variables.
SUMMARY OUTPUT

Regression Statistics
Multiple R 0.976566637371
R Square 0.953682397225
Adjusted R Squar 0.945962796763
Standard Error 10.88623830274
Observations 15

ANOVA
df SS MS F Significance F
Regression 2 29281.58712072 14640.79356036 123.5403829337 9.87362078E-09
Residual 12 1422.12221261 118.5101843841
Total 14 30703.70933333

Coefficients Standard Error t Stat P-value Lower 95%

Intercept -138.869993248 156.3645188677 -0.88811703738 0.391931841365 -479.559013062
x1 4.494201626742 0.677399399189 6.634493080629 2.41392417E-05 3.01827512498
x2 7.170418838358 6.074523753723 1.180408395632 0.260707517696 -6.06483145037
b. Are there any variables to be eliminated? If yes, indicate and explain.
Yes, there is and it is the X2 because its p-value is greater than
threshold of 0.05.
given below.

Upper 95% Lower 95.0% Upper 95.0%

201.8190265657 -479.559013062 201.8190265657
5.970128128504 3.01827512498 5.970128128504
20.40566912709 -6.06483145037 20.40566912709
A survey conducted by a research team was to investigate how the education level, tenure in current employment, and age, a

Education (No. of years) Length of tenure in current employment (No. of years)

17 8
12 12
20 9
14 4
12 1
14 9
12 8
18 10
16 12
11 7
16 14
12 4
16 17
13 7
11 6
20 4
19 7
16 12
12 2
10 6

a. Determine the estimated multiple linear regression equation that can be used to predict the annual income given number o
SUMMARY OUTPUT

Regression Statistics
Multiple R 0.818606797378511
R Square 0.670117088714303
Adjusted R Square 0.608264042848235
Standard Error 32446.8744689261
Observations 20

ANOVA
df
Regression 3
Residual 16
Total 19

Coefficients
Intercept -143481.192413645
Education (No. of years) 10011.9212403369
Length of tenure in current emplo -2193.88376370611
Age (No. of years) 2689.24051661598

b. Are there any variables to be eliminated? If yes, indicate those variables and explain why.

Yes. Since the length of tenure in current employment has a value of 0.32, greater than the p-value threshold of 0.05
tenure in current employment, and age, are related to annual income. A sample 20 employees is selected and the data is given below.

Age (No. of years) Annual income ($)

40 124,000
41 30,000
44 193,000
42 88,000
19 27,000
28 43,000
43 96,000
37 110,000
36 88,000
39 36,000
36 81,000
22 38,000
45 140,000
42 11,000
18 21,000
40 151,000
35 124,000
38 48,000
19 26,000
44 124,000

predict the annual income given number of years school completed (Education), length of tenure in current employment, and age.

SS MS F Significance F
34218155395.164 11406051798.388 10.83401923594 0.000393506606
16844794604.836 1052799662.80225
51062950000

Standard Error t Stat P-value Lower 95% Upper 95%

39925.5953997264 -3.59371453267364 0.002431284253 -228119.673676 -58842.7111512
2570.58480903386 3.89480292778197 0.001287795122 4562.524881568 15461.31759911
 2158.82905263426 -1.01623783551971 0.324637926042 -6770.3969125 2382.629385086
986.353429403574 2.72644717040433 0.014939599398 598.2646547183 4780.216378514

reater than the p-value threshold of 0.05, it should be eliminated

e data is given below.

oyment, and age.

Lower 95.0% Upper 95.0%

-228119.673676 -58842.7111512
4562.524881568 15461.31759911
 -6770.3969125 2382.629385086
598.2646547183 4780.216378514