Reference no: EM132795089

Question R&D Spending (Thousands of Dollars)

Use the following TABLE and the information given to answer to the below questions. A Hardware store manager believes that there is a linear relationship between the income from sales of goods (in thousands of dollars) and the amount spent on advertising (in thousands of dollars).

R&D    Spending    (Thousands    of Dollars) Income from Sales (Thousands of Dollars)

6                                                                       20

6                                                                       22

4                                                                      21

5                                                                      24

3                                                                       27

3.5                                                                    27

Required:

a) Predicted income from the sales of goods when $ 9.8 is spent on R&D?

b) The value of r is such that -1 < r < +1. The + and - signs are used for positive linear correlations and negative linear correlations, respectively. Calculate R value and discuss the final result.