Question:

The following data related to the scores obtained by a sales man of a company in an intelligent test and their weekly sales ( in 000's)
Obtain the regression equation of sales on intelligence test scores of salesman. If the intelligence test score of salesman is 65.
What would be the expected weekly sales?
Salesmen Intelligence
A
B
C
D
E
F
G
H
I
Test Score (X)
50
60
50
60
80
50
80
40
70
Weekly Sales (Y)
30
60
40
50
60
30
70
50
60
Soltion:
To find regerssion equation of Y on X
let the regression eqution of Y on X be Y=a+bX
Y=a+bX
To find a,b solve the normal equations
Y=Na+bX
XY=aX+bX2

Total:

X
50
60
50
60
80
50
80
40
70
540

Y
30
60
40
50
60
30
70
50
60
450

XY
1500
3600
2000
3000
4800
1500
5600
2000
4200
28200

X2
2500
3600
2500
3600
6400
2500
6400
1600
4900
34000

Here N=a; Substitute the values of x, y, x2, xy in equation (2) we get,

(450=9a+540b)60 (1)
27000=540a+32400b (2)
28200=540a+34000b (3)
(3)eq. - (2)eq.
28200=540a+34000b
(-)
27000=540a+32400b
1200=1600b
b=1200/1600= 0.75
Substitute b in eq.(3)
28200=540a+34000(0.75)
28200-25500=540a
2700=540a
a=5
..a=5; b=0.75
Regression equation of sales of intelligence
Y= 5+(0.75)X
To find Y when X=65
Y= 5+(0.75)65
=53.75

( in 000's)
65.

calculate the coefficient of correlation

X
2
Y
7

3
9

4
10

5
14

6
15

SOLUTION:

summary of calculation for correltion coefficient

X

Y
2
3
4
5
6

x=X-X
7
9
10
14
15

y=Y-Y
-2
-1
0
1
2

X2
-4
-2
-1
3
4

Y2
4
1
0
1
4

16
4
1
9
16

The value of r can be calculated by r=xy/x2.y2

r=21/10*46
r= 0.98
therefore X and Y are perfect positively correlated.

fficient
xy
8
2
0
3
8