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14. | Health Insurance: Administrative Cost The following data are based on information from Domestic Affairs. Let x be the average number of employees in
14. | Health Insurance: Administrative Cost The following data are based on information from Domestic Affairs. Let x be the average number of employees in a group health insurance plan, and let y be the average administrative cost as a percentage of claims. X 3 7 15 35 75 40 35 30 25 18 (a) Make a scatter diagram and draw the line you think best fits the data. (b) Would you say the correlation is low, moderate, or strong? positive or negative? (c) Use a calculator to verify that Ex = 135, Ex2 = 7133, Zy = 148, Ey? = 4674, and Exy = 3040. Compute r. As x increases from 3 to 75, Explain. does the value of r imply that y should tend to increase or decrease? 15
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