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Author Question: Would it be better for a customer buying a diamond to have a negative residual or a positive ... (Read 13 times)

natalie2426

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on: Jul 25, 2018
Would it be better for a customer buying a diamond to have a negative residual or a positive residual from this model? Explain.
 
  In an effort to decide if there is an association between the year of a postal increase and the new postal rate for first class mail, the data were gathered from the United States Postal Service. In 1981, the United States Postal Service changed their rates on March 22 and November 1. This information is shown in the table below.

Question 2

Interpret the intercept of your model in context.
 
  What will be an ideal response?


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tranoy

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Reply #1 on: Jul 25, 2018
Answer to Question 1

It would be better for customers to have a negative residual from this model, since a negative residual would indicate that the actual cost of the diamond was less than the model predicted it to be.

Answer to Question 2

The intercept of the model is -558.52. The model predicts that a diamond of 0 carats costs -558.52. This is not realistic.


natalie2426

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Reply 2 on: Jul 25, 2018
Great answer, keep it coming :)

LegendaryAnswers

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Reply 3 on: Yesterday
Excellent

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