Question

Listed below are paired data consisting of amounts spent on advertising (in millions of dollars) and the profits (in millions of dollars). Determine if there is a significant linear correlation between advertising cost and profit . Use a significance level of 0.01 and round all values to 4 decimal places.

Advertising CostProfit

323

422

523

626

723

825

919

1025

1133

Ho: ρ = 0
Ha: ρ ≠ 0

Find the Linear Correlation Coefficient
r =

Find the p-value
p-value =   

The p-value is

Less than (or equal to) αα

Greater than αα

The p-value leads to a decision to

Do Not Reject Ho

Reject Ho

Accept Ho

The conclusion is

There is insufficient evidence to make a conclusion about the linear correlation between advertising expense and profit.

There is a significant positive linear correlation between advertising expense and profit.

There is a significant linear correlation between advertising expense and profit.

There is a significant negative linear correlation between advertising expense and profit.

Answer 1

Given:

Ho: ρ = 0
Ha: ρ ≠ 0

Significance level, = 0.01

p-value is greater than significance level , = 0.01 so we fail to reject null hypothesis.

So accept H0.

There is insufficient evidence to make a conclusion about the linear correlation between advertising expense and profit.