The following table gives the approximate economic value associated with various levels of oil...
Question:
The following table gives the approximate economic value associated with various levels of oil recovery in a U.S. state.
| Percent Recovery (%) | 10 | 40 | 50 | 80 |
| Economic Value ($ billions) | 900 | 1,600 | 1,700 | 2,700 |
(a.) Estimate a regression equation with percent recovery as the independent variable and economic value as the dependent variable. (b.) Use the estimated regression equation to predict the economic value associated with a recovery level of 70%.
Using Regression Analysis to Forecast Business Outcomes
Regression analysis can be used to establish and assess statistical relationships between past business initiatives and specific outcomes. The estimated results from a regression model can then be used as a valuable aid to decision making by providing forecasts of the likely results from future initiatives.
Answer and Explanation: 1
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View this answer(a.) The result obtained from estimating a linear regression equation is as follows:
- economic value = 582 + 25.4(percent recovery)
The R square for...
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Using Regression Analysis in Business
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Chapter 3 / Lesson 7
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Regression analysis uses statistics to establish correlations between a dependent variable (affected by others) and multiple independent variables (those affecting the dependent variable). Explore how regression analysis and regression equations are applied to business.
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