Chapter 8.9, Problem 14STP

To determine

To calculate: To find which is the best prediction for the amount of money in circulation per person in $2020$

Answer to Problem 14STP

Thebest prediction of amount of money in circulation per person in $2020$ is $\$4185$

Explanation of Solution

Given information: Scatter plot showing how much money is in circulation per person in the Unites States in different years

  

Formula Used:

Equation of line passing through two points is given as

  $y-y_2=\frac{y_2-y_1}{x_2-x_1}\left(x-x_2\right)$

Calculation:

Scatter plot is given as follows:

  

Points on the line from graph are as follows:

  $\left(2001,2122\right)$ and $\left(2006,2665\right)$

Equation of line passing through the above points is calculated as follows:

  $\begin{array}{l}y-2122=\frac{2665-2122}{2006-2001}\left(x-2001\right)\\ y-2122=\frac{543}{5}\left(x-2001\right)\\ 5y-10610=543x-1086543\\ 5y=543x-1075933\end{array}$

Now, amount of money in the year $2020$ is calculated as follows:

  $\begin{array}{l}5y=543\left(2020\right)-1075933\\ 5y=1096860-1075933\\ 5y=20927\\ y=4185.4\\ y\approx 4185\end{array}$

Conclusion:

Hence, the best prediction of amount of money in circulation per person in $2020$ is $\$4185$