Chapter 1.4, Problem 28E

(a)

To determine

To calculate: The regression line to show Continental’s net income as a function of the price of oil and also calculate correlation coefficient using the technology when the table representing the price of oil and the profit of airline over the period $2005\text{-}2010$ is as follows:

Year	$2005$	$2006$	$2007$	$2008$	$2009$	$2010$
Price of oil($/barrel)	$56$	$63$	$67$	$92$	$54$	$71$
Continental Net income($ million)	$-850$	$250$	$450$	$-2,100$	$-1,450$	$-700$

(b)

To determine

The relation between Continental’s net income and the price of oil by using the value of correlation coefficient r when the table representing the price of oil and the profit of airline over the period $2005-2010$ is as follows:

Year	$2005$	$2006$	$2007$	$2008$	$2009$	$2010$
Price of oil($/barrel)	$56$	$63$	$67$	$92$	$54$	$71$
Continental Net income($ million)	$-850$	$250$	$450$	$-2,100$	$-1,450$	$-700$

(c)

To determine

To graph: The regression line to support the answer calculated in part $\left(b\right)$. When the table representing the price of oil and the profit of airline over the period $2005-2010$ is as follows:

Year	$2005$	$2006$	$2007$	$2008$	$2009$	$2010$
Price of oil($/barrel)	$56$	$63$	$67$	$92$	$54$	$71$
Continental Net income($ million)	$-850$	$250$	$450$	$-2,100$	$-1,450$	$-700$