Lobster price. Of course, what matters most to the individual entrepreneur—the licensed commercial lobster fisher—is the price of lobster. Here’s an analysis relating that price ($/lb) to the number of traps (millions):

a) Are the assumptions and conditions for regression inference satisfied?

b) What does the coefficient of Traps mean in this model?
Does it predict that licensing more traps would cause an increase in the price of lobster? Suggest some alternative explanations.

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Dependent variable is: Price/Ib = R-squared = 93.7% R-squared (adjusted) 93.6% S 0.2890 with 562- 54 degrees of freedom Variable Coeff SE(Coeff) t-ratio P-value Intercept -0.276454 0.0812 -3.40 0.0013 Traps (M) 1.25210 0.0441 28.4 0.0001 Price/lb Residuals 3 2 1 0.8 0.4 00 0.0 -0.4 888 0.75 1.50 Traps (M) 2.25 3.00 2 Predicted - 3