Problem 2

Please help me solve this in Excel showing the formulas that I can follow to understand. Thank you.

Super Markets Inc. is considering expanding into the Scottsdale, Arizona, area. You as director of planning must present an analysis of the proposed expansion to the operating committee of the board of directors. As a part of your proposal, you need to include information on the amount people in the region spend per month for grocery items. You would also like to include information on the relationship between the amount spent for grocery items and income. Assume amount spent is the dependent variable and monthly income is the independent variable.

Using Excel, run a regression analysis (ensure level of significance = 0.05).

Data

Household	Amount	Income
1	$278	$5,068
2	$393	$5,596
3	$512	$3,780
4	$551	$5,247
5	$691	$4,377
6	$686	$4,230
7	$831	$4,257
8	$735	$5,326
9	$632	$5,132
10	$616	$5,996
11	$571	$4,749
12	$629	$4,841
13	$556	$4,918
14	$748	$5,564
15	$600	$6,033
16	$557	$4,993
17	$678	$5,102
18	$636	$5,653
19	$678	$5,911
20	$687	$6,550
21	$1,075	$5,683
22	$922	$7,380
23	$648	$7,285
24	$1,067	$7,651
25	$832	$7,599
26	$892	$6,768
27	$934	$8,895
28	$1,066	$8,004
29	$1,258	$7,893
30	$997	$7,696
31	$983	$8,904
32	$1,265	$8,345
33	$1,109	$9,423
34	$887	$9,555
35	$1,081	$8,901
36	$1,226	$9,747
37	$1,155	$9,942
38	$1,374	$9,977
39	$1,511	$9,056
40	$1,148	$9,740

a. Create a scatter diagram for the independent variable acting on the dependent variable. What type of relationship exists? Explain your rationale. b. What is the Null Hypothesis for the overall model? c. What is the Alternative Hypothesis for the overall model? d. What is the regression equation? e. What is the standard error? Describe what this means as related to the problem. f. Interpret the appropriate R2 value. g. What does the overall statistical significance explain with respect to the model?