The American Association of Individual Investors (AAII) On-Line Discount Broker Survey polls members on their experiences with discount brokers. As part of the survey, members were asked to rate the quality of the speed of execution with thei broker as well as provide an overall satisfaction rating for electronic trades. Possible responses (scores) were no opinion (0), unsatisfied (1), somewhat satisfied (2), satisfied (3), and very satisfied (4). For each broker summary scores were computed by calculating a weighted average of the scores provided by each respondent. A portion of the survey results follow (AAII website, February 7, 2012). Brokerage Speed Satisfaction Scottrade, Inc. 2.6 3.1 Charles Schwab 3.4 3.3 Fidelity Brokerage Services 3.7 3.6 TD Ameritrade 3.2 3.6 E*Trade Financial 2.4 1.9 Vanguard Brokerage Services 3.5 3.9 USAA Brokerage Services 3.9 4.0 Thinkorswim 3.2 3.1 Wells Fargo Investments 2.7 2.8 Interactive Brokers 2.7 2.5 Zecco.com 4.0 3.6 a. Select a scatter diagram for these data with the speed of execution as the independent variable. A. B. 4.5 4.5 3.5 3.5 3- 2.5+ 2.5 2.5 3.5 •4 4.5 2.5 . 3.5 4 4.5 Speed of Exec ution Speed of Exec ution

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The American Association of Individual Investors (AAII) On-Line Discount Broker Survey polls members on their experiences with discount brokers. As part of the survey, members were asked to rate the quality of the speed of execution with their
broker as well as provide an overall satisfaction rating for electronic trades. Possible responses (scores) were no opinion (0), unsatisfied (1), somewhat satisfied (2), satisfied (3), and very satisfied (4). For each broker summary scores were
computed by calculating a weighted average of the scores provided by each respondent. A portion of the survey results follow (AAII website, February 7, 2012).
Brokerage
Speed
Satisfaction
Scottrade, Inc.
2.6
3.1
Charles Schwab
3.4
3.3
Fidelity Brokerage Services
3.7
3.6
TD Ameritrade
3.2
3.6
E*Trade Financial
2.4
1.9
Vanguard Brokerage Services
3.5
3.9
USAA Brokerage Services
3.9
4.0
Thinkorswim
3.2
3.1
Wells Fargo Investments
2.7
2.8
Interactive Brokers
2.7
2.5
Zecco.com
4.0
3.6
a. Select a scatter diagram for these data with the speed of execution as the independent variable.
A.
В.
4.5-
4.5
3.5
3.
3-
2.5+
2.5
2.5
3
3.5
4.5
2.5.
3.5
4
4.5
Speed of Exec ut ion
Speed of Exec ution
Satisfaction
uopejszes
Transcribed Image Text:The American Association of Individual Investors (AAII) On-Line Discount Broker Survey polls members on their experiences with discount brokers. As part of the survey, members were asked to rate the quality of the speed of execution with their broker as well as provide an overall satisfaction rating for electronic trades. Possible responses (scores) were no opinion (0), unsatisfied (1), somewhat satisfied (2), satisfied (3), and very satisfied (4). For each broker summary scores were computed by calculating a weighted average of the scores provided by each respondent. A portion of the survey results follow (AAII website, February 7, 2012). Brokerage Speed Satisfaction Scottrade, Inc. 2.6 3.1 Charles Schwab 3.4 3.3 Fidelity Brokerage Services 3.7 3.6 TD Ameritrade 3.2 3.6 E*Trade Financial 2.4 1.9 Vanguard Brokerage Services 3.5 3.9 USAA Brokerage Services 3.9 4.0 Thinkorswim 3.2 3.1 Wells Fargo Investments 2.7 2.8 Interactive Brokers 2.7 2.5 Zecco.com 4.0 3.6 a. Select a scatter diagram for these data with the speed of execution as the independent variable. A. В. 4.5- 4.5 3.5 3. 3- 2.5+ 2.5 2.5 3 3.5 4.5 2.5. 3.5 4 4.5 Speed of Exec ut ion Speed of Exec ution Satisfaction uopejszes
2.5
3.5
•4
4.5
2.5 .
3.5
4
4.5
Speed of Exec ut ion
Speed of Execut ion
c.
D.
4.5
2.5
2.5-
2.5
3.5
4.5
2.5
3.5
4.5
Speed of Execut ion
Speed of Exec ut ion
- Select your answer - V
b. What does the scatter diagram developed in part (a) indicate about the relationship between the two variables?
The scatter diagram indicates a - Select your answer - v linear relationship between = speed of execution rating and y= overall satisfaction rating for electronic trades.
c. Develop the least squares estimated regression equation. Enter negative value as negative number.
Satisfaction =
Speed (to 4 decimals)
d. Provide an interpretation for the slope of the estimated regression equation.
The slope of the estimated regression line is approximately
|(to 4 decimals). So, a one unit - Select your answer - v in the speed of execution rating will increase the overall satisfaction rating by approximately
points (to 1 decimal).
e. Suppose E*Trade Financial developed new software to increase their speed of execution rating. If the new software is able to increase their speed
execution rating from the current value of 2.4 to the average speed of execution rating for the
other 10 brokerage firms that were surveyed, what value would you predict for the overall satisfaction rating?
(to 3 decimals)
Transcribed Image Text:2.5 3.5 •4 4.5 2.5 . 3.5 4 4.5 Speed of Exec ut ion Speed of Execut ion c. D. 4.5 2.5 2.5- 2.5 3.5 4.5 2.5 3.5 4.5 Speed of Execut ion Speed of Exec ut ion - Select your answer - V b. What does the scatter diagram developed in part (a) indicate about the relationship between the two variables? The scatter diagram indicates a - Select your answer - v linear relationship between = speed of execution rating and y= overall satisfaction rating for electronic trades. c. Develop the least squares estimated regression equation. Enter negative value as negative number. Satisfaction = Speed (to 4 decimals) d. Provide an interpretation for the slope of the estimated regression equation. The slope of the estimated regression line is approximately |(to 4 decimals). So, a one unit - Select your answer - v in the speed of execution rating will increase the overall satisfaction rating by approximately points (to 1 decimal). e. Suppose E*Trade Financial developed new software to increase their speed of execution rating. If the new software is able to increase their speed execution rating from the current value of 2.4 to the average speed of execution rating for the other 10 brokerage firms that were surveyed, what value would you predict for the overall satisfaction rating? (to 3 decimals)
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