Question

5. A researcher creates a scatter plot that displays the relationship between the number of years in business, , and the percentage of company business that is fair trade, . The researcher creates a line of best fit, , and wants to find the residuals for the companies that have been in business for 3 years.

Answer 1

Based on the information given, it should be noted that the residual for the two points will be 0.087 and -0.033 respectively.

How to find the residual.

From the complete information, the predicted value for the point (3, 0.42) will be:

= (0.091 × 3) + 0.060

= 0.0273 + 0.060

= 0.333

Therefore, the residual will be:

= 0.42 - 0.333 = 0.087

The predicted value for the point (3, 0.3) will be:

y = 0.091x + 0.060.

= (0.091 × 3) + 0.060.

= 0.333

Therefore, the residual will be:

= 0.3 - 0.333 = -0.033

Therefore, the residual for the two points will be 0.087 and -0.333 respectively.

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