John is an undergraduate business major studying at a local university.He wonders how his grade point average (GPA)can affect his future earnings.He asks five recent business school graduates information on their GPA and income (in $1,000s).The following table shows this information. 
a.Construct a scatterplot and verify that estimating a simple linear regression is appropriate in this case.
b.Calculate b0 and b1.What is the sample regression equation?
c.Interpret the coefficient for GPA.
d.Find the predicted income earned if a GPA equals 3.0,3.3,and 3.6.
Definitions:
Noncash Transfers
Benefits provided by the government to individuals in forms other than direct cash, such as food stamps or medical aid.
Lorenz Curve
A graphical representation of income inequality within a population.
Poverty Rate
The percentage of the population that lives below the national poverty line, indicating the proportion of society experiencing poverty.
Income Distribution
The way in which a country’s total income is divided among its population, affecting economic equity and standard of living.
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