The iPhone six has been out for few years now and a lot of data has been collect
ID: 3061738 • Letter: T
Question
The iPhone six has been out for few years now and a lot of data has been collected. A marketing firm wants to model the price (p) of an iPhone six and Weekly Demand (s). Below is a table of data that have been collected. Price = p, (S) 150 170 190 210 230 250 | Weekly Demand = s, (1,006) 217 204 191 184 176 Round answers to 4 decimal places a) Find the correlation coefficient, be careful with the sign. b) Perform a hypothesis test to see if the correlation is statistically significant. What is the p-value? c) Is the correlation statistically significant at the 0.01 significance level? Select an answer d) Find the linear model that best fits this data using regression and enter the model below. Be careful what letter(s) you use. Preview c) What does the model predict will be the weekly demand if the price of an iPhone six is $234? thousand d) According to the model at what should the price be set in order to have a weekly demand of 183,200 iPhone sixes? Hint: Set weekly demand at 183.2 and solve for price. Round your answer to the nearest dollar.Explanation / Answer
P value = 0.000 < 0.05 implies that H0 is rejected or Correlation may be treated as highly significant.
Demand = 282 - 0.459 Price
Predictor Coef SE Coef T P
Constant 282.214 8.178 34.51 0.000
Price -0.45857 0.04030 -11.38 0.000
S = 3.372 R-Sq = 97.0% R-Sq(adj) = 96.3%
Analysis of Variance
Source DF SS MS F P
Regression 1 1472.0 1472.0 129.45 0.000
Residual Error 4 45.5 11.4
Total 5 1517.5
P-value of the regression = 0.000 < 0.05 or 0.01 implies that model is best fit for the data.
Demand = 282 - 0.459 Price
Demand = 282 - 0.459 *234 = 174.594 ~ 175 Units
The regression equation is
Price = 603 - 2.12 Demand
Price = 603-2.12*183.2 = 214.616 ~ 215
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