Elementary Statistics: Picturing the World (7th Edition)
7th Edition
ISBN: 9780134683416
Author: Ron Larson, Betsy Farber
Publisher: PEARSON
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Chapter 9.2, Problem 36E
a.
To determine
To construct: The
b.
To determine
To identify: Whether there is any outlier.
c.
To determine
To explain: Whether the outlier has a strong influence or not.
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You have been hired as an intern to run analyses on the data and report the results back to Sarah; the five questions that Sarah needs you to address are given below.
Does there appear to be a positive or negative relationship between price and screen size? Use a scatter plot to examine the relationship.
Determine and interpret the correlation coefficient between the two variables. In your interpretation, discuss the direction of the relationship (positive, negative, or zero relationship). Also discuss the strength of the relationship.
Estimate the relationship between screen size and price using a simple linear regression model and interpret the estimated coefficients. (In your interpretation, tell the dollar amount by which price will change for each unit of increase in screen size).
Include the manufacturer dummy variable (Samsung=1, 0 otherwise) and estimate the relationship between screen size, price and manufacturer dummy as a multiple linear regression model.
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Does there appear to be a positive or negative relationship between price and screen size? Use a scatter plot to examine the relationship. How to take snapshots: if you use a MacBook, press Command+ Shift+4 to take snapshots. If you are using Windows, use the Snipping Tool to take snapshots.
Question 1: Determine and interpret the correlation coefficient between the two variables. In your interpretation, discuss the direction of the relationship (positive, negative, or zero relationship). Also discuss the strength of the relationship.
Value of correlation coefficient:
Direction of the relationship (positive, negative, or zero relationship):
Strength of the relationship (strong/moderate/weak):
Question 2: Estimate the relationship between screen size and price using a simple linear regression model and interpret the estimated coefficients. In your interpretation, tell the dollar amount by which price will change for each unit of increase in screen size. (The answer for the…
In this problem, we consider a Brownian motion (W+) t≥0. We consider a stock model (St)t>0
given (under the measure P) by
d.St 0.03 St dt + 0.2 St dwt,
with So 2. We assume that the interest rate is r = 0.06. The purpose of this problem is to
price an option on this stock (which we name cubic put). This option is European-type, with
maturity 3 months (i.e. T = 0.25 years), and payoff given by
F = (8-5)+
(a) Write the Stochastic Differential Equation satisfied by (St) under the risk-neutral measure
Q. (You don't need to prove it, simply give the answer.)
(b) Give the price of a regular European put on (St) with maturity 3 months and strike K = 2.
(c) Let X =
S. Find the Stochastic Differential Equation satisfied by the process (Xt)
under the measure Q.
(d) Find an explicit expression for X₁ = S3 under measure Q.
(e) Using the results above, find the price of the cubic put option mentioned above.
(f) Is the price in (e) the same as in question (b)? (Explain why.)
Chapter 9 Solutions
Elementary Statistics: Picturing the World (7th Edition)
Ch. 9.1 - A director of alumni affairs at a small college...Ch. 9.1 - A researcher conducts a study to determine whether...Ch. 9.1 - Consider the data on page 469 on the salaries and...Ch. 9.1 - Calculate the correlation coefficient for the...Ch. 9.1 - Use technology to calculate the correlation...Ch. 9.1 - In Try It Yourself 4, you calculated the...Ch. 9.1 - In Try It Yourself 5, you calculated the...Ch. 9.1 - Two variables have a positive linear correlation....Ch. 9.1 - Describe the range of values for the correlation...Ch. 9.1 - What does the sample correlation coefficient r...
Ch. 9.1 - Give examples of two variables that have perfect...Ch. 9.1 - Explain how to determine whether a sample...Ch. 9.1 - Discuss the difference between r and p.Ch. 9.1 - What are the null and alternate hypotheses for a...Ch. 9.1 - In your own words, what does it mean to say...Ch. 9.1 - Graphical Analysis In Exercises 912, determine...Ch. 9.1 - Graphical Analysis In Exercises 912, determine...Ch. 9.1 - Graphical Analysis In Exercises 912, determine...Ch. 9.1 - Graphical Analysis In Exercises 912, determine...Ch. 9.1 - In Exercises 13 and 14, identify the explanatory...Ch. 9.1 - In Exercises 13 and 14, identify the explanatory...Ch. 9.1 - Graphical Analysis In Exercises 1518, the scatter...Ch. 9.1 - Graphical Analysis In Exercises 1518, the scatter...Ch. 9.1 - Graphical Analysis In Exercises 1518, the scatter...Ch. 9.1 - Graphical Analysis In Exercises 1518, the scatter...Ch. 9.1 - In Exercises 1922, two variables are given that...Ch. 9.1 - In Exercises 1922, two variables are given that...Ch. 9.1 - In Exercises 1922, two variables are given that...Ch. 9.1 - In Exercises 1922, two variables are given that...Ch. 9.1 - Constructing a Scatter Plot and Determining...Ch. 9.1 - Constructing a Scatter Plot and Determining...Ch. 9.1 - Constructing a Scatter Plot and Determining...Ch. 9.1 - Constructing a Scatter Plot and Determining...Ch. 9.1 - Constructing a Scatter Plot and Determining...Ch. 9.1 - Constructing a Scatter Plot and Determining...Ch. 9.1 - In Exercise 23, add data for a child who is 6...Ch. 9.1 - In Exercise 24, remove the data for the girl who...Ch. 9.1 - In Exercise 25, remove the data for the...Ch. 9.1 - In Exercise 26, add data for an international...Ch. 9.1 - The t-Test for Correlation Coefficients In...Ch. 9.1 - The t-Test for Correlation Coefficients In...Ch. 9.1 - The t-Test for Correlation Coefficients In...Ch. 9.1 - The t-Test for Correlation Coefficients In...Ch. 9.1 - Interchanging x and y In Exercise 26, let the time...Ch. 9.1 - Generate a new data set. Using your knowledge of...Ch. 9.1 - Describe how to create a data set with a value of...Ch. 9.1 - Describe how to create a data set with a value of...Ch. 9.1 - Try to create a data set with a value of r that is...Ch. 9.2 - Find the equation of the regression line for the...Ch. 9.2 - Use technology to find the equation of the...Ch. 9.2 - The regression equation for the Old Faithful data...Ch. 9.2 - What is a residual? Explain when a residual is...Ch. 9.2 - Two variables have a positive linear correlation....Ch. 9.2 - Explain how to predict y-values using the equation...Ch. 9.2 - For a set of data and a corresponding regression...Ch. 9.2 - In order to predict y-values using the equation of...Ch. 9.2 - Why is it not appropriate to use a regression line...Ch. 9.2 - In Exercises 712, match the description in the...Ch. 9.2 - In Exercises 712, match the description in the...Ch. 9.2 - In Exercises 712, match the description in the...Ch. 9.2 - In Exercises 712, match the description in the...Ch. 9.2 - In Exercises 712, match the description in the...Ch. 9.2 - In Exercises 712, match the description in the...Ch. 9.2 - Graphical Analysis In Exercises 1316, match the...Ch. 9.2 - Graphical Analysis In Exercises 1316, match the...Ch. 9.2 - Graphical Analysis In Exercises 1316, match the...Ch. 9.2 - Graphical Analysis In Exercises 1316, match the...Ch. 9.2 - Finding the Equation of a Regression Line In...Ch. 9.2 - Finding the Equation of a Regression Line In...Ch. 9.2 - Finding the Equation of a Regression Line In...Ch. 9.2 - Finding the Equation of a Regression Line In...Ch. 9.2 - Finding the Equation of a Regression Line In...Ch. 9.2 - Finding the Equation of a Regression Line In...Ch. 9.2 - Finding the Equation of a Regression Line In...Ch. 9.2 - Finding the Equation of a Regression Line In...Ch. 9.2 - Finding the Equation of a Regression Line In...Ch. 9.2 - Finding the Equation of a Regression Line In...Ch. 9.2 - Registered Nurse Salaries In Exercises 2730, use...Ch. 9.2 - Registered Nurse Salaries In Exercises 2730, use...Ch. 9.2 - Registered Nurse Salaries In Exercises 2730, use...Ch. 9.2 - Registered Nurse Salaries In Exercises 2730, use...Ch. 9.2 - Interchanging X and y In Exercises 31 and 32,...Ch. 9.2 - Interchanging X and y In Exercises 31 and 32,...Ch. 9.2 - In Exercises 33 and 34, (a) find the equation of...Ch. 9.2 - In Exercises 33 and 34, (a) find the equation of...Ch. 9.2 - In Exercises 35 and 36, (a) construct a scatter...Ch. 9.2 - Prob. 36ECh. 9.2 - Prob. 37ECh. 9.2 - Prob. 38ECh. 9.2 - Prob. 39ECh. 9.2 - Prob. 40ECh. 9.2 - Prob. 41ECh. 9.2 - Prob. 42ECh. 9.2 - Prob. 43ECh. 9.2 - Prob. 44ECh. 9.2 - Prob. 45ECh. 9.2 - Prob. 46ECh. 9.2 - Prob. 47ECh. 9.2 - Prob. 48ECh. 9.2 - Prob. 1ACh. 9.2 - Prob. 2ACh. 9.2 - Prob. 3ACh. 9.2 - Prob. 4ACh. 9.3 - The correlation coefficient for the Old Faithful...Ch. 9.3 - Prob. 2TYCh. 9.3 - Using the results of Example 2, construct a 95%...Ch. 9.3 - Graphical Analysis In Exercises 13, use the...Ch. 9.3 - Graphical Analysis In Exercises 13, use the...Ch. 9.3 - Graphical Analysis In Exercises 13, use the...Ch. 9.3 - The coefficient of determination r2 is the ratio...Ch. 9.3 - What is the coefficient of determination for two...Ch. 9.3 - Two variables have a bivariate normal...Ch. 9.3 - In Exercises 710, use the value of the correlation...Ch. 9.3 - In Exercises 710, use the value of the correlation...Ch. 9.3 - In Exercises 710, use the value of the correlation...Ch. 9.3 - In Exercises 710, use the value of the correlation...Ch. 9.3 - Finding the Coefficient of Determination and the...Ch. 9.3 - Finding the Coefficient of Determination and the...Ch. 9.3 - Finding the Coefficient of Determination and the...Ch. 9.3 - Finding the Coefficient of Determination and the...Ch. 9.3 - Finding the Coefficient of Determination and the...Ch. 9.3 - Finding the Coefficient of Determination and the...Ch. 9.3 - Finding the Coefficient of Determination and the...Ch. 9.3 - Finding the Coefficient of Determination and the...Ch. 9.3 - Finding the Coefficient of Determination and the...Ch. 9.3 - Finding the Coefficient of Determination and the...Ch. 9.3 - Constructing and Interpreting a Prediction...Ch. 9.3 - Constructing and Interpreting a Prediction...Ch. 9.3 - Constructing and Interpreting a Prediction...Ch. 9.3 - Constructing and Interpreting a Prediction...Ch. 9.3 - STEM Employment and Mean Wage The table shows the...Ch. 9.3 - Constructing and Interpreting a Prediction...Ch. 9.3 - Constructing and Interpreting a Prediction...Ch. 9.3 - Fund Assets The table shows the total assets (in...Ch. 9.3 - New-Vehicle Sales The table shows the numbers of...Ch. 9.3 - New-Vehicle Sales The table shows the numbers of...Ch. 9.3 - Old Vehicles In Exercises 3134, use the figure...Ch. 9.3 - Old Vehicles In Exercises 3134, use the figure...Ch. 9.3 - Old Vehicles In Exercises 3134, use the figure...Ch. 9.3 - Old Vehicles In Exercises 3134, use the figure...Ch. 9.3 - Prob. 35ECh. 9.3 - Prob. 36ECh. 9.3 - Prob. 37ECh. 9.3 - In Exercises 37 and 38, construct the indicated...Ch. 9.4 - A statistics professor wants to determine how...Ch. 9.4 - Use the regression equation found in Try It...Ch. 9.4 - Predicting y-Values In Exercises 14, use the...Ch. 9.4 - Predicting y-Values In Exercises 14, use the...Ch. 9.4 - Prob. 3ECh. 9.4 - Predicting y-Values In Exercises 14, use the...Ch. 9.4 - Finding a Multiple Regression Equation In...Ch. 9.4 - Finding a Multiple Regression Equation In...Ch. 9.4 - In Exercises 7 and 8, calculate r2adi and...Ch. 9.4 - In Exercises 7 and 8, calculate r2adi and...Ch. 9 - In Exercises 14, (a) display the data in a scatter...Ch. 9 - In Exercises 14, (a) display the data in a scatter...Ch. 9 - In Exercises 14, (a) display the data in a scatter...Ch. 9 - In Exercises 14, (a) display the data in a scatter...Ch. 9 - Prob. 9.1.5RECh. 9 - Prob. 9.1.6RECh. 9 - Prob. 9.1.7RECh. 9 - Prob. 9.1.8RECh. 9 - In Exercises 912, find the equation of the...Ch. 9 - Prob. 9.2.10RECh. 9 - In Exercises 912, find the equation of the...Ch. 9 - Prob. 9.2.12RECh. 9 - In Exercises 1316, use the value of the...Ch. 9 - Prob. 9.3.14RECh. 9 - Prob. 9.3.15RECh. 9 - Prob. 9.3.16RECh. 9 - Prob. 9.3.17RECh. 9 - Prob. 9.3.18RECh. 9 - Prob. 9.3.19RECh. 9 - Prob. 9.3.20RECh. 9 - Prob. 9.3.21RECh. 9 - In Exercises 1924, construct the indicated...Ch. 9 - Prob. 9.3.23RECh. 9 - Prob. 9.3.24RECh. 9 - Prob. 9.4.25RECh. 9 - Prob. 9.4.26RECh. 9 - Prob. 9.4.27RECh. 9 - Prob. 9.4.28RECh. 9 - Prob. 1CQCh. 9 - For Exercises 18, use the data in the table, which...Ch. 9 - Prob. 3CQCh. 9 - Prob. 4CQCh. 9 - Prob. 5CQCh. 9 - Prob. 6CQCh. 9 - Prob. 7CQCh. 9 - For Exercises 18, use the data in the table, which...Ch. 9 - Prob. 9CQCh. 9 - Net Sales The equation used to predict the net...Ch. 9 - For Exercises 29, use the data in the table, which...Ch. 9 - For Exercises 29, use the data in the table, which...Ch. 9 - For Exercises 29, use the data in the table, which...Ch. 9 - For Exercises 29, use the data in the table, which...Ch. 9 - For Exercises 29, use the data in the table, which...Ch. 9 - For Exercises 29, use the data in the table, which...Ch. 9 - For Exercises 29, use the data in the table, which...Ch. 9 - For Exercises 29, use the data in the table, which...Ch. 9 - Analyzing the Data (a) The data in the table show...Ch. 9 - Making Predictions Construct a 95% prediction...Ch. 9 - Prob. 1TCh. 9 - Prob. 2TCh. 9 - Prob. 3TCh. 9 - Prob. 4TCh. 9 - Prob. 5TCh. 9 - Use technology to find the multiple regression...Ch. 9 - Prob. 7T
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