The following scatterplot shows a company’s monthly sales, in thousands of dollars, versus monthly advertising dollars spent, in thousands of dollars. Which of the following points is most likely a high-leverage point with respect to a regression of monthly sales versus advertising dollars?
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.
The following
Which of the following points is most likely a high-leverage point with respect to a regression of monthly sales versus advertising dollars?
![The image presents a scatter plot illustrating the relationship between advertising expenses and monthly sales. Here's a detailed explanation of the graph:
- **X-axis**: Represents the advertising dollars spent, measured in thousands. The values range from 5.0 to 7.0.
- **Y-axis**: Represents monthly sales figures, also measured in thousands. The values range from 105 to 125.
- **Data Points**: The scatter plot shows several points distributed across the graph, indicating individual data entries for specific levels of advertising spending and their corresponding monthly sales.
- **Trend Observation**: There is a visible positive correlation between advertising expenditure and sales. As the advertising budget increases, the monthly sales tend to increase as well.
This scatter plot can be utilized to analyze how advertising investments impact sales performance, potentially aiding in strategic business decisions regarding marketing budgets.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F78b15ee6-abc2-44d4-af66-bebccc1733be%2F9e90ed21-dbf4-45ee-8b64-2cc85b85d568%2F7y4of9n_processed.png&w=3840&q=75)
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