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Problem: A business analyst believes that December holiday sales in 2016 are a good predictor of December holiday sales in 2017. A random sample of 8 toys stores produced the following data where x is the amount of December holiday sales in 2016 and y is the amount of December sales in 2017, in dollars.
x y
10257 11689
6556 6438
7224 8662
9987 9454
11568 12004
8453 8021
4235 6048
5576 4850
Required:
Question 1: Find an equation of the least squares regression line. Round the slope and y-intercept value to two decimal places. Describe method for obtaining results.
Question 2: Based on the equation from part (a), what is the predicted 2017 December holiday sales if the 2016 December holiday sales is 6,000 dollars?
Question 3: Based on the equation from part (a), what is the predicted 2017 December holiday sales if the 2016 December holiday sales is 20,000 dollars?
Question 4: Which predicted 2017 holiday sales that you calculated for (b) and (c) do you think is closer to the true predicted 2017 holiday sales and why?
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