The regression equation NetIncome = 2,483 + 0.0431 Revenue was estimated from a
ID: 3241023 • Letter: T
Question
The regression equation NetIncome = 2,483 + 0.0431 Revenue was estimated from a sample of 100 leading world companies (variables are in millions of dollars).
Calculate the residual for the x, y pair ($44,164, $4,704). (A negative value should be indicated by a minus sign. Round your answer to 4 decimal places.)
Calculate the residual for the x, y pair ($62,476, $5,581).(A negative value should be indicated by a minus sign. Round your answer to 4 decimal places.)
The regression equation NetIncome = 2,483 + 0.0431 Revenue was estimated from a sample of 100 leading world companies (variables are in millions of dollars).
Explanation / Answer
Answer:
The regression equation NetIncome = 2,483 + 0.0431 Revenue was estimated from a sample of 100 leading world companies (variables are in millions of dollars).
(a-1)
Calculate the residual for the x, y pair ($44,164, $4,704). (A negative value should be indicated by a minus sign. Round your answer to 4 decimal places.)
Predicted NetIncome = 2483+0.0431*44164=4386.4684
Residual = 4704-4386.4684 = 17.5320
(b-1)
Calculate the residual for the x, y pair ($62,476, $5,581).(A negative value should be indicated by a minus sign. Round your answer to 4 decimal places.)
Predicted NetIncome = 2483+0.0431*62476=5175.7156
Residual = 5581-5175.7156 = 405.2844
(a-2) Did the regression equation underestimate or overestimate the net income?
The regression equation underestimates the net income.
The regression equation NetIncome = 2,483 + 0.0431 Revenue was estimated from a sample of 100 leading world companies (variables are in millions of dollars).