Question
The following 20 observations are for two quantitative variables, x and y . Observation x y 1 -22 22 2 -33 49 3 2 8
The following 20 observations are for two quantitative variables, x and y.
Observation | x | y |
1 | -22 | 22 |
2 | -33 | 49 |
3 | 2 | 8 |
4 | 29 | -16 |
5 | -13 | 10 |
6 | 21 | -28 |
7 | -13 | 27 |
8 | -23 | 35 |
9 | 14 | -5 |
10 | 3 | -3 |
11 | -37 | 48 |
12 | 34 | -29 |
13 | 9 | -18 |
14 | -33 | 31 |
15 | 20 | -16 |
16 | -3 | 14 |
17 | -15 | 18 |
18 | 12 | 17 |
19 | -20 | -11 |
20 | -7 | -22 |
(a) | Create a scatter chart in Excel for these 20 observations. |
(b) | Fit a linear trendline to the 20 observations. What can you say about the relationship between these two quantitative variables? Choose the correct answer below. | |
(i) | The trendline confirms that there is a positive linear trend between profits and market capitalization. | |
(ii) | The trendline confirms that there is a negative linear trend between profits and market capitalization. |
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Econometric Analysis
Authors: William H. Greene
5th Edition
130661899, 978-0130661890
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