Additional Homework Problems - Pearson

4.58 A careful analysis of the cost of operating an automobile was conducted by a firm. The following
model was developed:
ŷ = 4,000 + 0.20x
Where
ŷ is the annual cost and x is the miles driven.
a) If the car is driven 15,000 miles this year, what is the forecasted cost of operating this automobile?
b) If the car is driven 25,000 miles this year, what is the forecasted cost of operating this automobile?
4.59 The following multiple-regression model was developed to predict job performance as measured by a
company job performance evaluation index based on a preemployment test score and college grade point
average (GPA):
Where
ŷ = 35 + 20x 1 + 50x 2
ŷ = job performance evaluation index
x 1 = preemployment test score
x 2 = college GPA
a) Forecast the job performance index for an applicant who had a 3.0 GPA and scored 80 on the
preemployment test.
b) Forecast the job performance index for an applicant who had a 2.5 GPA and scored 70 on the
preemployment test.
4.60 A study to determine the correlation between bank deposits and consumer price indices in
Birmingham, Alabama, revealed the following (which was based on n = 5 years of data):
‣ x = 15
‣ x 2 = 55
‣ xy = 70
‣ y = 20
‣ y 2 = 130
a) What is the equation of the least square regression line?
b) Find the coefficient of correlation. What does it imply to you?
c) What is the standard error of the estimate?
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