Question

In: Statistics and Probability

A recent article in Bloomberg Businessweek listed the “Best Small Companies.” We are interested in the...

A recent article in Bloomberg Businessweek listed the “Best Small Companies.” We are interested in the current results of the companies’ sales and earnings. A random sample of 12 companies was selected and the sales and earnings, in millions of dollars, are reported below.

Sales Earnings Sales Earnings
Company ($ millions) ($ millions) Company ($ millions) ($ millions)
Papa John’s International $ 91.2 5.2 Checkmate Electronics $ 18.5 2.6
Applied Innovation 20.3 4.6 Royal Grip 12.8 1.8
Wall Data 19.0 1.4 M-Wave 19.8 3.6
Integracare 75.0 8.2 Serving-N-Slide 51.8 8.3
Davidson & Associates 60.9 6.6 Daig 29.9 6.5
Chico’s FAS 48.2 4.2 Cobra Golf 73.2 12.8

a. Draw a scatter diagram

b. The coefficient of correlation is
c. The regression equation, with the coefficients, is ŷ = + x
d. For a small company with $50 million in sales, an estimate of the earnings is ($ millions).

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