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he Iowa Basic Skills test is given to elementary schools in Iowa. The data for this example is the average fourth-grade test scores for all

he Iowa Basic Skills test is given to elementary schools in Iowa. The data for this example is the average fourth-grade test scores for all the elementary schools in the six largest Iowa communities. The poverty index is the percentage of the students in the school that are in the federal free and reduced-price breakfast and lunch program - this serves as a proxy for the level of poverty. A plot of the average test score versus the poverty index follows. Does there appear to be a relationship between these two variables? Describe this relationship. The output of a simple linear regression model with Test as the Y variable and Poverty as the X variable follows. Find the estimated values of the three parameters in this model: beta_0, beta_1and sigma. Find 95% confidence intervals for the parameter beta_0 and beta_1. The t value you need is 1.98. Find the value of R^2 and write a sentence describing what this means. A plot of the residuals versus the fitted values follows. Interpret this plot. Does this suggest that there are any problems with this regression model? Why or why not? A Normal probability plot of the residuals follows.

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