What Is the Relationship Between Diamond Price and Carat Size $y$

question 22

Multiple Choice

What is the relationship between diamond price and carat size? 307 diamonds were sampled (ranging in size from 0.18 to 1.1 carats) and a straight-line relationship was hypothesized between
Y = diamond price (in dollars) and x = size of the diamond (in carats) . The simple linear regression
For the analysis is shown below: Least Squares Linear Regression of PRICE
Predictor


Interpret the estimated $y$ -intercept of the regression line.

• A) When a diamond is \(11598.9\) carats in size, we estimate the price of the diamond to be \(\$ 2298.36\).
• B) When a diamond is 0 carats in size, we estimate the price of the diamond to be \(\$ 2298.36\).
• C) No practical interpretation of the \(y\)-intercept exists since a diamond of 0 carats cannot exist and falls outside the range of the carat sizes sampled.
• D) When a diamond is 0 carats in size, we estimate the price of the diamond to be \$11,598.90.

---

Definitions:

Salmon

A species of fish that is often found in the Northern Atlantic and Pacific oceans, known for their migration from ocean to freshwater to spawn.

Absolute Advantage

The ability of an individual, firm, or country to produce more of a good or service than competitors, using the same amount of resources.

Hamburgers

A type of food consisting of a cooked patty of ground meat, typically beef, placed inside a sliced bread roll or bun.

Comparative Advantage

The ability of an individual, firm, or country to produce a good or service at a lower opportunity cost than others.