The outcome for Chapter 14.3 states that "Regression analysis is a statistical tool that is used for two main purposes: description and prediction."

• Based on the outcome, provide a current event of a business application using regression analysis for decision making.

HA : B1 4 0 at the significance level a = 0.05 C DE G SUMMARY OUTPUT Regression Statistics 3 Multiple R 0.9589 R Square 0.9194 Adjusted R Square 0.9180 6 Standard Error 16.2705 7 Observations 58 9 ANOVA 10 df SS MS F Significance F 11 Regression 169115.67 169115.67 638.83 0.0000 12 Residual 56 14824.81 264.73 13 Total 57 183940.48 La 15 Coefficients Standard Error t Stat P-value Lower 95%% Upper 95% 16 Intercept 703.39 14.20 49.53 0.0000 674.94 731.84 0.54 25.28 0.0000 -14.72 -12.56 17 Combined MPG -13.64 83 8:05 AM 85 F 9/5/202a AA Rex y - 703.39 - 13.64x Before the analysts attempt to describe the relationship between miles per gallon and CO2 emitted, they need to test whether there is a statistically significant linear relationship between the two variables. To do this, they can apply the t-test described in Section 14.2 0 to test the following null and alternative hypotheses: Ho : B1 = 0 HA : B1 0 at the significance level Q = 0.05 D SUMMARY OUTPUT Regression Statistics Multiple R 0.9589$15/epubcfi/6/310[%3Bund.vst.idref%3DP70010125190000000000000000091E8]!/4/2[P70010125190000000000... Vehicle Mileage The U.S. Department of Energy website (www.fueleconomy.gov) contains data on 2015 automobile mileage ratings. Analysts collected data on a variety of variables for a sample of cars. Included among those data are the Environmental Protection Agency (EPA)'s combined highway and city miles per gallon and the estimated number of grams of CO2 emitted per mile driven. The analysts are interested in the relationship between combined mileage (x) and grams of CO2 emitted (y). The data are in the file EPA Mileage 2015. The analysts can develop a simple linear regression model using Excel. The Excel output is shown in Figure 14.17 3. For these sample data, the coefficient of determination R? = 0.9194 indicates that knowing the combined miles per gallon of the car explains 91.94% of the variation in the grams of CO2 emitted. The estimated regression equation is 554 / 836 )Q AAR 14.3 Uses for Regression Analysis OUTCOME 5 Regression analysis is a statistical tool that is used for two main purposes: description and prediction. This section discusses these two applications. Regression Analysis for Description Business Application Using Regression Analysis for Decision Making Vehicle Mileage The U.S. Department of Energy website (www.fueleconomy.gov) contains data on 2015 automobile mileage ratings. Analysts collected data on a variety of variables for a sample of cars. Included among those data are the Environmental Protection Aneney (FPA )'s combined 554 836 8:03 AM 85"F 9/5/2022