A sporting goods store would like to determine what relationship exists between their annual advertising budget (Y) and the annual sales (X) so that they can assess the effectiveness of their current channels. The data for the last five years is provided in the table below (in $000).

Using the data above do the following: (use Excel for your analysis) 1. Write the appropriate null hypothesis and alternative hypothesis. 2. Draw a scatter plot for your data. 3. Perform regression analysis and write the equation of the regression line. 4. Perform an F-test for the existence of a linear relationship between Y and X. Use a 5% level of significance. 5. Explain in words and numbers what this regression equation says. 6. Find the value of the correlation coefficient between the two variables and interpret the result. 7. Find the t-value and p-value of the slope. What does it mean? Explain. 8. Is there a significant linear association between your dependent and independent variables? Test an appropriate hypothesis and state your conclusion. 9. Find a 95% confidence interval for the slope and interpret it. 10. Find the coefficient of determination. What does it mean? Using this number, how well does the estimated model fit the sample data? 11. Write a one paragraph report of using the results you obtained.

Quarter 1 Budget $55 $58 $30 $35 NM LON 00 0 10 11 12 13 14 15 16 17 18 19 20 $8 $16 $33 $90 $67 $30 $58 $99 $47 $25 $14 $48 $78 $36 $93 $84 Sales $404 $407 $359 $344 $212 $280 $334 $395 $405 $319 $418 $440 $382 $298 $267 $376 $412 $335 $415 $420 Quarter 1 Budget $55 $58 $30 $35 NM LON 00 0 10 11 12 13 14 15 16 17 18 19 20 $8 $16 $33 $90 $67 $30 $58 $99 $47 $25 $14 $48 $78 $36 $93 $84 Sales $404 $407 $359 $344 $212 $280 $334 $395 $405 $319 $418 $440 $382 $298 $267 $376 $412 $335 $415 $420