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Activity 9

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josh mendejar
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13 views2 pages

Activity 9

Uploaded by

josh mendejar
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PDF, TXT or read online on Scribd
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Activity 9

1. Identify the independent and dependent variables

- The store size is the independent variable and the profit is the dependent variable.

2. Compute for the correlation coefficient

3. Based on 2, explain the relationship between the two variables. Discuss the implication of this
relationship.

- There is a positive and strong correlation between store size and profit because the computed
regression coefficient is more than 0.7. As a result, Lizzie may use Linear Regression to anticipate
the business earning per hundred square feet between 1,200 to 4,000 square feet. Furthermore,
there is a proportional relationship between store size and profit, meaning that as the size of
the business grows, so does the profit.

4. Solve for the y-intercept and the slope


5. From the equation of the regression line that describes the relationship between the two variables

y = a + bx
y = 0.828 + 0.577x
Where x is the Store size in square feet and y is the profit in 10,000

6. Predict the profit of the fashion boutique business when the store measures 3800 square feet.
Explain the result.

y = 0.828s + 0.577(38)
y = 0.828 + 21.935
y = 22.763
y = 22.763 x 10,000
y = 227,631.369
The expected profit would be 227,631 if the store was 3800 square feet. Because the store’s size is
measured at 100 square feet, the 3800 square feet is not instantly substituted into the equation. As a
result, before substituting the x variable, the given 3800 sq. ft. should be divided by 100 sq. ft.

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