A Professor of Economics Wants to Study the Relationship Between

question 193

Essay

A professor of economics wants to study the relationship between income y (in $1000s) and education x (in years). A random sample of eight individuals is taken and the results are shown below. $$\begin{array} { | l | c | c | c | c | c | c | c | c | } \hline \text { Education } & 16 & 11 & 15 & 8 & 12 & 10 & 13 & 14 \\\hline \text { Income } & 58 & 40 & 55 & 35 & 43 & 41 & 52 & 49 \\\hline\end{array}$$ Assume that the conditions for the tests conducted in the previous two questions are not met. Do the data allow us to infer at the 5% significance level that years of education and income are linearly related?

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Definitions:

Traveler's Cheques

Financial instruments issued by banks allowing the holder to exchange the cheque for local currency at various locations globally, intended to help travelers avoid the risks of carrying cash.

Internet

A global network of computers that provides a vast array of information and communication facilities, including access to websites, email, and social media platforms.

Canada

A country in North America known for its vast landscapes, multicultural cities, and as the second largest country by total area globally.

Economic Domination

A situation where certain nations or groups hold significant control over wealth and economic resources, influencing both regional and global economics.