Computer Lab 7
The JMP file attached to this assignment shows the daily closing price for the S&P 500, the NASDAQ, Gold, and Silver. For your analysis you are to use Gold as the dependent (response) variable and Silver as the independent (predictor) variable.
1.
Using the formula b
1
= r*(s
y
/s
x
) and the fact that r = 0.9651 find b
1
. Note that you will need to calculate s
Gold
and s
Silver
utilizing JMP.
Sgold=40.097
Ssilver=1.678
b
1
= .9651*(40.0971/1.6780)
b
1=23.0618
2.
Using the formula find b
0
.
Avg gold-
23.0618*avg silver
924.8468-23.0618*17.5906= 519.1759
b
0
=
519.1759
3.
What is the model that has been fit to the data?
Goldhat=
519.1759+23.0618silver
4.
What is the predicted price for Gold if Silver = 15? Show your work.
865.1029=
519.1759+23.0618*15
5.
Two weeks ago, when silver price was 15, gold price was 850. What is the value of the residual for this point and what does the sign of the residual say? Show your work.
850-
865.1029=-15.1029
Residual = -15.1029 and since its negative the line over predicted the value
