Question

The following table shows the number of cars sold last month by six dealers at Centreville Nissan dealership and their number of years of sales experience.

Years of Experience	Sales
1	7
2	9
2	9
4	8
5	14
8	14

A: Management would like to use simple regression analysis to estimate monthly car sales using the number of years of sales experience. Estimate and interpret the following: a) Regression Equation, b) Slope, c) y-intercept.

B: what happens when years increase by 1?

C What is the predicted salary for someone with 4 years of higher education.

Answer 1

A.

The following data are passed:

X	Y
1	7
2	9
2	9
4	8
5	14
8	14

The independent variable is X, and the dependent variable is Y. In order to compute the regression coefficients, the following table needs to be used:

	X	Y	X*Y	X2	Y2
	1	7	7	1	49
	2	9	18	4	81
	2	9	18	4	81
	4	8	32	16	64
	5	14	70	25	196
	8	14	112	64	196
Sum =	22	61	257	114	667

Based on the above table, the following is calculated:

Therefore, we find that the regression equation is:

B.

When we increase years by 1 i.e. when X increases by 1, Sales (Y) also increases by 1

C.

The question seems a little out of context, but this is the way we calculate the predicted value when X=4

When X = 4

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