A fuel company wants to find the functional relation between the amount of gas it sells for heating and the daily temperature. Given the values for 10 observations ∑x= - 50, ∑x^2 = 626, ∑y^2 = 6432 ∑y= 222, ∑xy= —1743 for the daily average temperature and gas sales (in thousand liters). a) Obtain and interpret the correlation coefficient for the variables. b) Set up the regression equation and interpret the coefficients. c) Find R2 and interpret. d) When the temperature is 10 degrees, please observe the gas sales amount.
Correlation
Correlation defines a relationship between two independent variables. It tells the degree to which variables move in relation to each other. When two sets of data are related to each other, there is a correlation between them.
Linear Correlation
A correlation is used to determine the relationships between numerical and categorical variables. In other words, it is an indicator of how things are connected to one another. The correlation analysis is the study of how variables are related.
Regression Analysis
Regression analysis is a statistical method in which it estimates the relationship between a dependent variable and one or more independent variable. In simple terms dependent variable is called as outcome variable and independent variable is called as predictors. Regression analysis is one of the methods to find the trends in data. The independent variable used in Regression analysis is named Predictor variable. It offers data of an associated dependent variable regarding a particular outcome.
A fuel company wants to find the
∑y= 222, ∑xy= —1743 for the daily average temperature and gas sales (in thousand liters).
a) Obtain and interpret the
b) Set up the regression equation and interpret the coefficients.
c) Find R2 and interpret.
d) When the temperature is 10 degrees, please observe the gas sales amount.
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