A financial analyst is examining the relationship between stock prices and earnings per share. She chooses sixteen, publicly traded companies at random and records for each the company‘s current stock price and the company‘s earnings per share reported for the past 12 months. Her data are given below, with x denoting the earnings per share from the previous year and y denoting the current stock ( both in dollars). A scatter plot of her data is shown in Figure 1.
A financial analyst is examining the relationship between stock prices and earnings per share. She chooses sixteen, publicly traded companies at random and records for each the company‘s current stock price and the company‘s earnings per share reported for the past 12 months. Her data are given below, with x denoting the earnings per share from the previous year and y denoting the current stock ( both in dollars). A scatter plot of her data is shown in Figure 1.
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A financial analyst is examining the relationship between stock prices and earnings per share. She chooses sixteen, publicly traded companies at random and records for each the company‘s current stock price and the company‘s earnings per share reported for the past 12 months. Her data are given below, with x denoting the earnings per share from the previous year and y denoting the current stock ( both in dollars). A scatter plot of her data is shown in Figure 1.
Transcribed Image Text:**Scatter Plot Analysis**
**Figure 1:**
This scatter plot displays the relationship between two variables, denoted as \( x \) and \( y \). The data points are marked with 'x'.
**Axes:**
- The horizontal axis (x-axis) represents the variable \( x \), with values ranging from 0 to 60.
- The vertical axis (y-axis) represents the variable \( y \), with values ranging from 0 to 3.5.
**Observation:**
- The scatter plot suggests a positive correlation between \( x \) and \( y \). As the value of \( x \) increases, the value of \( y \) also tends to increase.
- This trend is indicated by an upward pattern in the data points.
**Educational Note:**
Scatter plots are useful for visualizing the relationship between two quantitative variables. They are often used to determine if there is a correlation or pattern, which can lead to further statistical analysis or influence decision-making in various fields.
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Transcribed Image Text:### Earnings per Share and Current Stock Price Data
Below is a table showing data for earnings per share (EPS) and current stock price for various companies. This data set can be used to analyze the relationship between a company's earnings per share and its stock price.
| **Earnings per share, x (in dollars)** | **Current stock price, y (in dollars)** |
|----------------------------------------|-----------------------------------------|
| 14.72 | 0.56 |
| 33.28 | 1.93 |
| 58.26 | 2.63 |
| 31.35 | 0.87 |
| 57.22 | 2.24 |
| 51.33 | 2.76 |
| 43.95 | 1.51 |
| 26.66 | 0.93 |
| 41.86 | 1.25 |
| 37.13 | 1.56 |
| 49.77 | 1.51 |
| 39.42 | 1.20 |
| 41.46 | 1.64 |
| 16.73 | 0.52 |
| 21.19 | 0.70 |
| 30.49 | 1.38 |
This data can be used for various types of statistical analyses, such as regression analysis, to determine if there is a significant relationship between the earnings per share and the current stock price of companies.
### Graphs and Diagrams
To the right side of the table, there is a partially visible graph which appears to be a scatter plot. The scatter plot is one of the most common tools for analyzing the relationship between two numerical variables.
#### Details of the Scatter Plot (Partially Visible):
- **Axes Labels**:
- The x-axis likely represents the earnings per share (EPS) in dollars.
- The y-axis represents the current stock price in dollars.
- **Data Points**:
- Each point on the scatter plot corresponds to a pair of EPS and stock price from the table.
- **Trend Line**:
- If a trend line is drawn, it would illustrate the overall direction of the relationship between EPS and stock price (e.g., positive, negative, or no correlation).
### How to Use the Data
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