An automobile manufacturing company wanted to investigate how the price of one of it's car models depreciates with age. The research department at the company took a sample of 8 cars of this model and collected the following information on the ages (x, in years) and prices (y, in hundreds of pesos) of these cars as shown: Age, x 8 3 7 9 2 5 4 6 Price, y 18 95 55 24 140 40 38 99 Find the estimated price of a 15 year old car
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.
1. An automobile manufacturing company wanted to investigate how the price of one of it's car models depreciates with age. The research department at the company took a sample of 8 cars of this model and collected the following information on the ages (x, in years) and prices (y, in hundreds of pesos) of these cars as shown:
Age, x
8
3
7
9
2
5
4
6
Price, y
18
95
55
24
140
40
38
99
Find the estimated price of a 15 year old car
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