Reference no: EM132348030

You work in a country where every resident plays a sport every day. However the only two sports played are table tennis (when it is raining) and golf (when it is sunny). Your job is to provide statistical analysis to the management of a company that sells "ping pong" (table tennis) balls directly through the internet. Over the past eight months you have collected the following data:

Month Marketing expenditure ($)

Number of rainy days

Number of sales

1 4150 6 778

2 3000 10 779

3 2500 25 4200

4 10600 2 250

5 12000 7 300

6 8000 20 6000

7 1500 18 1500

8 6850 9 500

For this data, the sample coefficients of variation for marketing expenditure, number of rainy days per month, and number of sales have been calculated to be 0.642849, 0.656009, and 1.194023, respectively.

(a) The marketing manager has told you that it simply makes sense that there is a strong and positive correlation between marketing expenditure and the number of sales made. Provide some analysis regarding this relationship. What do you conclude from your results?

(b) Using the data above, calculate the correlation coefficients between the number of rainy days per month and the number of sales. The covariance between the number of rainy days per month and the number of sales has been calculated as 14012.23.

(c) What does the result in (b) above suggest, and provide a potential reason for this result. Try using R to calculate the sample correlation coefficients from the raw data given in the table.