Spending on credit cards decreases after the Christmas spending season (as measu

Question

Spending on credit cards decreases after the Christmas spending season (as measured by amount charged on a credit card in December). The accompanying data set contains the monthly credit card charges of a random sample of 99cardholders

Build a regression model to predict January spending from December's spending.

Data Table

December January 1543.31 904.14 4299.88 7204.96 4230.15 4238.09 202.72 80.01 3296.26 4040.91 874.21 89.27 3806.59 3291.87 1933.85 2417.15 99.13 83.84 504.77 6.42 411.24 0 682.59 564.21 2159.01 2712.99 1123.27 187.24 2505.53 3265.41 1838.09 1523.12 9.95 1360.28 2335.34 733.98 78.49 75.12 101.24 70.27 597.88 634.08 648.85 1042.13 235.69 553.71 1265.83 1016.08 2126.15 1304.47 3.66 249.45 305.94 48.71 1900.38 872.58 559.14 485.59 2444.46 617.07 2802.27 1575.03 532.18 422.37 537.19 769.85 767.49 56.61 1959.38 1485.69 1678.39 495.58 2062.94 1064.81 396.68 509.95 5638.91 5643.24 5.5 5.5 2279.73 870.48 3820.67 1633.57 89.21 92.22 1451.43 669.48 527.92 828.55 105.82 69.22 1404.59 830.34 4230.53 2300.87 632.66 270.54 970.99 210.46 348.23 1011.78 0 1044.49 50.01 298.71 29.98 -29.99 471.68 1635.62 1116.82 1731.64 70.64 0 31.11 31.38 4.95 4.95 2521.12 1087.33 16.94 26.88 40.57 120.17 258.94 2009.13 123.02 291.44 0 104.02 109.85 53.05 5049.54 2840.56 3676.52 675.26 139.83 221.84 76.02 37.76 3151.98 533.08 2988.59 1934.53 651.36 692.47 9121.48 6800.35 916.89 393.34 2871.13 1309.19 797.75 796.01 34.57 0 44.15 1041.33 478.17 565.39 761.61 339.46 2348.55 5274.37 44.29 40.07 43.26 43.38 1340.38 653.76 1128.16 1070.46 2800.34 2336.62 52.13 91.55 1295.11 1434.81 328.75 719.47 28.33 28.64 598.92 979.55 4279.49 1575.21 568.35 0 479.55 162.08 1614.86 494.34 285.61 533.43 1285.28 462.37 3763.47 1478.42 Jan +Dec (Round to four decimal places as needed.)

Explanation / Answer

a) jan^ = 120.948188 + 0.699273* December

b) for december = 2000

jan^ = 120.948188 + 0.699273* 2000

= 1519.494188

SUMMARY OUTPUT Regression Statistics Multiple R 0.784244857 R Square 0.615039996 Adjusted R Square 0.611071336 Standard Error 874.2604741 Observations 99 ANOVA df SS MS F Significance F Regression 1 118451665.4 118451665.4 154.9742285 7.99716E-22 Residual 97 74140143.53 764331.3766 Total 98 192591808.9 Coefficients Standard Error t Stat P-value Lower 95% Intercept 120.9481886 115.5494242 1.046722556 0.297828836 -108.3854327 December 0.699273285 0.056171652 12.44886455 7.99716E-22 0.587788105

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