Stats Solutions

(All Steps) We have Sample Number Assets ($ millions) Return (%) 1 AARP 622.2 10.8 2 Babson 160.4 11.3 3 Compass 275.7 11.4 4 Galaxy 433.2 9.1 5 Keystone

Question: We have

Sample Number Assets ($ millions) Return (%)
1 AARP 622.2 10.8
2 Babson 160.4 11.3
3 Compass 275.7 11.4
4 Galaxy 433.2 9.1
5 Keystone 437.9 9.2
6 MFS Bond A 494.5 11.6
7 Nichols 158.3 9.5
8 T Rowe 681 8.2
9 Thompston 241.3 6.8

The table above contains data from 9 mutual funds -- total assets held by the fund and last year's return on the investment of the assets (cash). Please:

  1. Construct a scatter diagram -- be sure you choose the correct dependent and independent variable. Think about these questions: Which variable influences the other? What is the direction of the relationship? Do assets influence the return or does the return influence the assets? What you choose as the "causing" variable will be X, what you choose as the variable being "caused" or influenced will be Y. Discuss your diagram.
  2. Compute the coefficients of correlation and determination and discuss what they mean.
  3. Test the significance of the sample correlation computed in #2.
  4. Develop a regression equation. What return would you predict for $400M in assets? Is the regression equation you developed meaningful? Why or why not?

Price: $2.99
Solution: The downloadable solution consists of 6 pages
Deliverable: Word Document


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