Quiz 3 The following shows average yearly sales and expenditures of a small company. Year annual net sales/$1000 amount spent on advertising/$1000 2000 88 5.7 2001 93 5.9 2002 95 6.0 2003 98 5.8 2004 103 6.3 2005 110 6.5 2006 111 6.5 2007 119 7.1 2008 129 7.5 2009 131 8.0 2010 135 8.1 2011 140 7.7 2012 142 8.5 2013 137 8.0 2014 135 7.9 1. Correlation and Regression Analysis a. Draw a scatter plot for the annual net sales and amount spent on advertising. b. Compute the correlation coefficient (r) of the annual net sales and amount spent on advertising. c. Is there a significant linear correlation between annual net sales and amount spent on advertising? Use a = 0.05. d. Fit the linear regression equation that expresses annual net sales (y) in terms of amount spent on advertising (x). e. Interpret bo and by f. Compute and interpret R2 2. Basic Concept of Time Series Analysis a. Create a line graph for variable annual net sales and amount spent on advertising. You can use the same cartesian plane for both variable. b. Create a linear trend equation for variable annual net sales. c. Create a linear trend equation for variable amount spent on advertising