What does the scatter diagram developed in part (a) indicate about the relationship between the two variables?

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Note: Once you completed these questions using the built-in process  under  Data  Analysis in Excel or Minitab 19 to support your results, you need to save the outputs of Excel as a picture and add it to your solutions in MS Word for each part of these Problems. Save all solutions as one PDF file and upload it in Moodle. As for the Minitab 19, simply copy the outputs and the plots into the same MS Word. Make only one PDF file and upload it using the dropbox of Moodle. Please note that your uploaded PDF file must contain enough detailed for full mark.

To help consumers in purchasing a laptop computer,Consumer Reports calculates an overall test score for each computer tested based upon rating factors such as ergonomics, portability, performance, display, and battery life. Higher overall scores indicate better test results. The following data show the average retail price and the overall score for ten 13- inch models (Consumer Reports website, October 25, 2012).

Brand & Model	Price ($)	Overall Score
Samsung Ultrabook NP900X3C-A01US	1250	83
Apple MacBook Air MC965LL/A	1300	83
Apple MacBook Air MD231LL/A	1200	82
HP ENVY 13-2050nr Spectre XT	950	79
Sony VAIO SVS13112FXB	800	77
Acer Aspire S5-391-9880 Ultrabook	1200	74
Apple MacBook Pro MD101LL/A	1200	74
Apple MacBook Pro MD313LL/A	1000	73
Dell Inspiron I13Z-6591SLV	700	67
Samsung NP535U3C-A01US	600	63

a) Develop a scatter diagram with price as the independent variable.

b) What does the scatter diagram developed in part (a) indicate about the relationship between the two variables?

c) Use the Least Squares method to develop the estimated regression equation.

d) Provide an interpretation of the slope of the estimated regression equation.

e) Another laptop that Consumer Reports tested is the Acer Aspire S3-951-6646 Ultrabook; the price for this laptop was $700. Predict the overall score for this laptop using the estimated regression equation developed in part (c).

The Dow Jones Industrial Average (DJIA) and the Standard & Poor’s 500 (S&P 500) indexes are used as measures of overall movement in the stock market. The DJIA is based on the price movements of 30 large companies; the S&P 500 is an index composed of 500 stocks.

Some say the S&P 500 is a better measure of stock market performance because it is broader based. The closing price for the DJIA and the S&P 500 for 15 weeks, beginning with January 6, 2012, follow (Barron’s website, April 17, 2012).

Date	DJIA	S&P
January 6	12360	1278
January 13	12422	1289
January 20	12720	1315
January 27	12660	1316
February 3	12862	1345
February 10	12801	1343
February 17	12950	1362
February 24	12983	1366
March 2	12978	1370
March 9	12922	1371
March 16	13233	1404
March 23	13081	1397
March 30	13212	1408
April 5	13060	1398
April 13	12850	1370

a) Develop a scatter diagram with DJIA as the independent variable.

b) Develop the estimated regression equation.

c) Test for a significant relationship. Use .

d) Did the estimated regression equation provide a good fit? Explain.

e) Suppose that the closing price for the DJIA is 13,500. Predict the closing price for the S&P 500.

f) Should we be concerned that the DJIA value of 13,500 used to predict the S&P 500 value in part (e) is beyond the range of the data used to develop the estimated regression equation?

g) Add a note on your potential leverages, outliers, and influential observations.

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