Question: The local city government has collected the following data on annual sales tax collections and new car registrations.

Year Annual Sales Tax New Car Registrations

Collections($ millions) (thousands)

1994 1.0 10

1995 1.4 12

1996 1.9 15

1997 2.0 16

1998 1.8 14

1999 2.1 17

2000 2.3 20

a. Scatter plot. Do an X-Y (scatter) chart with new car registrations on the horizontal axis and sales tax collection on the vertical axis. Fit a linear trendline to these data. Display the regression equation on the chart.

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b. Excel Functions. On your data sheet, find the values of the following functions. Be sure to label your response properly. Explain the meaning of the coefficient of determination.

INTERCEPT(),SLOPE(),RSQ(),CORREL(),STEYX()

C. Regression Equation. Develop the regression equation relating sales tax collections to new car registrations. Use the equation to predict the amount of sales tax collections for next year when new car registrations are estimated to be 22 thousand.

d. Interval Estimate. Do an approximate 95% interval estimate around the point estimate you determined in part 3.

e. Regression Tool. Use the regression tool to perform a simple linear regression of sales tax collections (the dependent variable)on new car registrations (the independent variable). Is the regression efficient?