A Local Tire Dealer Wants to Predict the Number of Tires

question 130

Short Answer

A local tire dealer wants to predict the number of tires sold each month.He believes that the number of tires sold is a linear function of the amount of money invested in advertising.He randomly selects 6 months of data consisting of monthly tire sales (in thousands of tires)and monthly advertising expenditures (in thousands of dollars).The simple linear regression equation is ŷ = 3 + 1x.The dealer randomly selects one of the six observations,with a monthly sales value of 8000 tires and monthly advertising expenditures of $7000.Calculate the value of the residual for this observation.

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Definitions:

Judge-made Law

Law established through decisions made by judges in court cases, also known as common law or case law.

Court of Chancery

A court that historically dealt with disputes in equity, such as trusts and estates, rather than legal claims.

Law of Equity

A body of law that supplements the common law and corrects injustices by providing remedies not available in courts of law.

Common-law Courts

Courts that base their decisions on the common law system, which is built on precedent and judicial decisions, as opposed to statutory law.