The closing stock price for each of two stocks was recorded over a 12-month period. The closing price for the Dow Jones Industrial Average (DJIA) was also recorded over this same time period. These values are shown in the following table:

(a) Develop a regression model to predict the price of stock 1 based on the Dow Jones Industrial Average.
(b) Develop a regression model to predict the price of stock 2 based on the Dow Jones Industrial Average.
(c) Which of the two stocks is most highly correlated to the Dow Jones Industrial Average over this timeperiod?

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MONTH DJIA STOCK STOCK 2 11,168 11,150 11,186 11,381 11,679 12,081 2.222 12.463 48.5 48.2 44.5 44.7 49.3 49.3 46.1 46.2 32.4 31.7 31.9 36.6 36.7 38.7 39.5 41.2 43.3 39.4 40.1 42.1 45.2 4 6 12.622 77 12,269 12,354 13,063 13,326 48.3 47.0 47.9 47.8 10 12 13