Stratton, Inc., has collected the following information on its cost of electricity: Machine Hours Total Electricity Costs January 510 $240 February 540 $300 March 360 $205 April 450 $215 May 660 $290 June 690 $300 July 340 $180 August 520 $260 September 240 $120 October 750 $340 November 840 $360 December 600 $320 Assuming the line intersects the y-axis at $50 and using the August activity levels, calculate the equation of the line that would be drawn for a scattergraph. (Round variable cost to 3 decimal places, e.g. 15.251 and fixed cost to 0 decimal places, e.g 15.)
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.
| Machine Hours | Total Electricity Costs | ||||
|---|---|---|---|---|---|
|
January
|
510 | $240 | |||
|
February
|
540 | $300 | |||
|
March
|
360 | $205 | |||
|
April
|
450 | $215 | |||
|
May
|
660 | $290 | |||
|
June
|
690 | $300 | |||
|
July
|
340 | $180 | |||
|
August
|
520 | $260 | |||
|
September
|
240 | $120 | |||
|
October
|
750 | $340 | |||
|
November
|
840 | $360 | |||
|
December
|
600 | $320 |
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