Internal Code: 1HEAE
Statistics Assignment Help:
Task:
A critical factor for used-car buyers when determining the value of a car is how far the car
has been driven. To examine this issue, a used-car dealer randomly selected 90 five-year-old Ford Lasers that has been sold at auctions during the past month. The dealer recorded the price and the number of kilometers on the odometer.
The data file dataset1.xls contains data of 90 cars and the variables in the dataset are:
- Price (Y, action selling price in $’000)
- Odometer (X, Odometer reading in ‘000 km)
The dependent variable for your analysis is Price.
Answer the following questions using dataset 1.
(a) Create a scatter plot of Y on the vertical axis against X on the horizontal axis (make sure to label each axis).
(b) Using the scatter plot in (a), does there appear to be a relationship between Y and X? If so, in what direction is the relationship? How strong is the relationship?
(c) Estimate a simple regression model using X to predict Y (present the output and write out the estimated equation).
(d) Interpret the intercept coefficient. Does it make sense?
(e) Interpret the slope coefficient.
(f) Compute the coefficient of determination and interpret its meaning.
(g) Compute the standard error of the estimate and interpret its meaning. Judge the magnitude of the standard error of the estimate.
(h) Perform a residual analysis (plot the residuals) and evaluate whether the assumptions of regression have been violated.
(i) Test for the significance of the slope coefficient using t test (follow all the necessary steps). Assume 5% level of significance.
(j) Test for the slope using F test (follow all the necessary steps). Assume 5% level of significance.
(k) Compute a 95% confidence interval estimate of the mean Y for all cars when X = 30 and interpret its meaning.
(l) Compute a 95% prediction interval of Y for a single car when X = 30 and interpret its meaning.
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