To determine how the average stock price (dependent variable) is affected by company's revenue (independent variable) a financial economist recorded the average stock price and the annual revenue for Pfizer, a pharmaceutical company, for the past 6 years. These data are listed here.

Avg. stock price ($) 35.854 34.820 33.662 38.310 36.810 35.900 Annual Revenue ('000) 46407 41908 43908 51750 49647 49227

Determine the regression equation. Show your work to get full credit.

Calculate the predicted average stock price for Pfizer if its annual revenue is 55000 (i.e., 55,000*1000 =

$55,000,000).

Test at a 5% significance level whether there is relationship (or not) between average stock price and

annual revenue for Pfizer. Conduct a two-tail test.