[TA03-12] By looking at the insurance rates shown in Applied Example 3.6, one can easily see that males pay higher rates for insurance than females of the same age. Is there a consistent pattern to this higher rate? To uncover any such pattern in the male/female $250,000 insurance rates from Applied Example 3.6:

a. Draw a scatter diagram of the insurance rates for males (y) versus females (x). Does the diagram show a linear relationship? Explain.

b. Calculate the linear correlation coefficient, r, for the variables. Is this a strong linear relationship?

Why?

c. Calculate the equation of the line of best fit.

d. Predict the monthly rate for a male who is the same age as a female whose monthly rate is

$15.00.

e. Based on the preceding answers, what conclusion can you make about the relationship between these male and female insurance rates?

What role does the slope of the line of best fit serve in describing the relationship?