How well does the regression line fit the observed data, what is the sample correlation coefficient between the two variables in this model and how can it be interpreted? Write the sample regression equation clearly defining the variables used.
How well does the regression line fit the observed data, what is the sample correlation coefficient between the two variables in this model and how can it be interpreted? Write the sample regression equation clearly defining the variables used.
MATLAB: An Introduction with Applications
6th Edition
ISBN:9781119256830
Author:Amos Gilat
Publisher:Amos Gilat
Chapter1: Starting With Matlab
Section: Chapter Questions
Problem 1P
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Question
How well does the regression line fit the observed data, what is the sample

Transcribed Image Text:Shengyu is an analyst for a company that provides clients with advice about economic
conditions. He notes that the United States (US) is experiencing high inflation at the
moment. He wonders if high inflation in the US somehow feeds through to cause high
inflation in China. To start his analysis, he downloads data on inflation from the OECD
website and runs a simple regression of Chinese inflation on US inflation for data from
Quarter 1 2005 to Quarter 2 2021 (each quarter's data on inflation is in terms of annual
percentage change). The Excel output for this is as follows:
spér DO
19646
SUMMARY OUTPUT
Regression Statistics
Multiple R
R Square
Adjusted R Square 0.273039
Standard Error
Observations
0.533126
0.284223
1.614377
66
ANOVA
df
SS
MS
Significance F
Regression
Residual
66.23271501 66.23272 25.41338 4.0545E-06
64
166.7977302 2.606215
Total
65
233.0304453
Coefficients Standard Error
t Stat
P-value
Intercept
X Variable 1
Lower 95% Upper 95% Lower 95.0% Upper 95.0%
0.397429191 2.071456 0.042352 0.02930082 1.617213 0.02930082 1.61721298
0.193938053 5.041168 4.05E-06 0.59023857 1.365110 0.59023857 1.36511017
0.823257
0.977674
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