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 250000
4085 55135.8
6558 97417.2 200000
12525 95198.9
3394 53579.7 150000
442.8 12466.3
633.1 8894.3 100000
3528 65872.4
2698 25661.3 50000
1200.65 19854.7
0
11.987 195643.8
-2000 0 20
641.8 10447.8
5043 66695.5 M
5206 53558.4 L

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

The relationship between the 2 variables is the whenever there is a change in p

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

Constant 1,916.49
B1 n
X1 0.02

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

Y= constant + B1(X1)
Y= 1916.49+70721.3(0.02)
Y= 3536.59
If the market capitalization is 70,721.30 the predicted profit would be 3536.59.

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
 Profit vs. Market Capitalization
250000

200000

150000

100000

50000

0
-2000 0 2000 4000 6000 8000 10000 12000 14000

Market Capitalization ($ millions) x

Linear (Market Capitalization ($ millions) x)

between market capitalization and profit?

ver there is a change in profit, the change affect the market capitalization.

s profit based on its market capitalization. What is the estimated regression model?

Y= constant + B1(X1)
Y= 1916.49+B1(0.02)
 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
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

Scatterplot of Profits & Market Capitalization

600

500

400
Annual Maintenance Cost
300 ($) y

200

100

0
2 4 6 8 10 12 14 16

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

alization

al Maintenance Cost

ct the annual maintenance cost given the age of the car. What is the estimated regression model?
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.
b. Are there any variables to be eliminated? If yes, indicate and explain.
given below.
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

b. Are there any variables to be eliminated? If yes, indicate those variables and explain why.
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.
e data is given below.

oyment, and age.