You worked as an intern at We Always Win Car Insurance Company last summer. You
ID: 3182352 • Letter: Y
Question
You worked as an intern at We Always Win Car Insurance Company last summer. You notice that individual car insurance premiums depend very much on the age of the individual and the number of traffic tickets received by the individual. You performed a regression analysis in EXCEL and obtained the following partial information:
What is the estimated mean change in insurance premiums for every additional ticket received?
What is the 99% confidence interval for the change in mean insurance premiums of a person who has become 1 year older
Lower limit =
Upper limit =
Microsoft Excel was used to obtain the following quadratic trend equation:
Sales = 100 - 10X + 15X2.
The data used was from 2001 through 2010 coded 0 to 9. The forecast for 2011 is
_________________.
Regression Statistics Multiple R 0.8546 R Square 0.7303 Adjusted R Square 0.6853 Standard Error 226.7502 15 Observations ANOVA MS df SS F Significance F 2 Regression 835284.6500 16.2457 0.0004 Residual 12 616987.8200 Total 2287557.1200 Coefficients Standard Error t Stat P-value Lower 99% Upper 99% 161.9391 5.0714 0.0003 821.2617 Intercept 326.6124 1315.9111 Age 9.3444 1.4061 2.5988 -0.5411 0.5984 6.5321 Tickets 43.2470 243.4401 5.6291 0.0001 111.3406 375.5396Explanation / Answer
The estimated mean change in insurance premiums for every additional ticket received is 243.4401
The 99% confidence interval for the change in mean insurance premiums of a person who has become 1 year older is -9.3333 to 6.5321
Lower Limit : -9.3333
Upper Limit : 6.5321
The data used was from 2001 through 2010 coded 0 to 9. The forecast for 2011 is
The Regression equation is
Sales = 100 - 10(10) + 15(0) = 100- 100 = 0
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