Cars (1000s) Company U-Save Auto Rental System, Inc. Payless Car Rental System, Inc. ACE Rent A Car Rent-A-Wreck of America Triangle Rent-A-Car Affordable/Sensible Revenue ($millions) 118 135 100 11.5 10.0 9.0 5.5 4.2 37 40 3.3 32
Companies in the U.S. car rental market vary greatly in terms of the size of the fleet, the number of locations, and annual revenue. In 2011 Hertz had 320,000 cars in service and annual revenue of approximately $4.2 billion. The following data show the number of cars in service (1000s) and the annual revenue ($millions) for six smaller car rental companies (Auto Rental News website, August 7, 2012).
If required, enter negative values as negative numbers.
c. Use the least squares method to develop the estimated regression equation (to 3 decimals).
d. For every additional car placed in service, estimate how much annual revenue will change. Use estimated value rounded to 3 decimals.
e. Fox Rent A Car has 11,000 cars in service. Use the estimated regression equation developed in part (c) to predict annual revenue for Fox Rent A Car. Round your answer to nearest whole value.
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