Question

A manufacturer of exercise bicycles is studying the relationship between the number of months an exercise bicycle has been owned and the length of time it was used last week. Data for a random sample of 7 owners are provided in the table below Months Owned Hours Used Last Week 14 6 8 8 5 7 3 9 10 6 4 8 12 7

10 marks     e.                    Can it be concluded that the slope of the regression line is negative? Formulate and test the appropriate hypotheses at the 5% significance level. Use the critical value approach.

Answer 1

Following table shows the calculations:

	X	Y	X^2	Y^2	XY
	14	6	196	36	84
	8	8	64	64	64
	5	7	25	49	35
	3	9	9	81	27
	10	6	100	36	60
	4	8	16	64	32
	12	7	144	49	84
Total	56	51	554	379	386

Conclusion: There is evidence to conclude that the slope of the regression line is negative.