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Solution Regression

The document outlines calculations for deriving regression equations based on stock prices and sales data, including the closing prices of stocks and intelligence test scores of salesmen. It provides the methodology for calculating regression equations using the least squares method and includes examples with specific data points. Additionally, it discusses the correlation between husbands' and wives' ages, presenting regression equations to predict ages based on given values.

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goutamdiu444
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3 views4 pages

Solution Regression

The document outlines calculations for deriving regression equations based on stock prices and sales data, including the closing prices of stocks and intelligence test scores of salesmen. It provides the methodology for calculating regression equations using the least squares method and includes examples with specific data points. Additionally, it discusses the correlation between husbands' and wives' ages, presenting regression equations to predict ages based on given values.

Uploaded by

goutamdiu444
Copyright
© All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd

Solution Sheet

1. The following calculations have been made for closing prices of 12 stocks (X) on the Dhaka
Stock Exchange on a certain day along with the volume of sales in thousand of shares (Y).
From these calculations find the regression equations.  X  580;  Y  370;  XY  11,494
2 2
 X  41,658;  Y  17,206
Solution: Y on X,
By solving the following two equations, the parameters a and b can be derived as least squared
method.
∑ ∑

∑ ∑ ∑
Therefore, the equations would be the followings:

By multiplying equation (1) by 580 and equation (2) by 12, I get the followings:


Now putting the value of in equation (1) I get,




Therefore, the regression equation would be

Regression: X on Y,
By solving the following two equations, the parameters a and b can be derived as least squared
method.
∑ ∑

∑ ∑ ∑
Therefore, the equations would be the followings:

By multiplying equation (1) by 370 and equation (2) by 12 I get the followings:


Now putting the value of in equation (1) I get,




Therefore, the regression equation would be

Answer: and

2. The data given below relate to the scores obtained by 9 salesmen in an intelligence test and
their weekly sales, in lac of taka:
Salesman 1 2 3 4 5 6 7 8 9
Test Score 50 60 50 60 80 50 80 40 70
Sales (Tk.) 3 6 4 5 6 3 7 5 6
Obtain regression equation of sales on the intelligence test scores. If a salesman has obtained
a score of 65, what would be his expected weekly sales?

Solution: Assume, Y=Sales; and X=Intelligence Test Score.


Therefore, the equation of Y on X,
By solving the following two equations, the parameters a and b can be derived as least squared
method.
∑ ∑

∑ ∑ ∑
Therefore, the following calculation is required to derive the parameters to be estimated.
y x
3 50 2500 150
6 60 3600 360
4 50 2500 200
5 60 3600 300
6 80 6400 480
3 50 2500 150
7 80 6400 560
5 40 1600 200
6 70 4900 420
∑ ∑ ∑ ∑

Therefore, the equations would be the followings:

By multiplying equation (1) by 540 and equation (2) by 9, I get the followings:


Now putting the value of in equation (1) I get,




Therefore, the regression equation would be


Therefore the expected weekly sales of a salesman with respect to a score of 65 is

lac Tk.

Answer: and lac Tk.

3. The co-efficient of correlation between the ages of husbands and wives in a community was
found to be +0.80, the average of husbands age was 25 years and that of the wives age 22
years. Their standard deviation were 4 and 5 years respectively. Find with the help of
regression equations:

(a) The expected age of husband when the wife’s age is 16 years and
(b) The expected age of wife when the husband’s age is 33 years.

Solution: Assume, X=Husbands age and Y=Wives age.


Then, the value of , ̅ ,̅ , , and
Therefore, the regression equation of X on Y, ̅ ̅





and the regression equation of Y on X, ̅ ̅





Answer: and

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