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The mean and standard deviation of the amount x a company spends on advertising in a year (in thousands of dollars) are 67.2 and 5.4 respectively, and the mean and standard deviation of yearly revenue y are 738.3 and 45.5 respectively, and the correlation between x and y is 0.87. The equation of the least squares regression line for predicting y from x is

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Answer:

Step-by-step explanation:

Given that the mean and standard deviation of the amount x a company spends on advertising in a year (in thousands of dollars) are 67.2 and 5.4 respectively.

The mean and standard deviation of yearly revenue y are 738.3 and 45.5 respectively

Correlation = 0.87

[tex]Slope = b =\frac{rs_y}{s_x} \\=0.87(\frac{45.5}{5.4} )\\=7.331[/tex]

Hence regression line is

[tex]y=7.331x+c[/tex]

Since regression line passes through (x bar, y bar) we find that (67.2, 738.3) satisfies this equation

[tex]738.3=7.331(67.2)+c\\c = 245.687[/tex]

Regression line is

[tex]y=7.331x+245.687[/tex]

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