Casio FX-730P Owner's Manual page 51

2-5 Statistical Calculations
Exercise:
The table below shows the ratios of advertising expenditure (advertising expendi-
ture/operating expenses) and the ratios of operating profit (operating profit/sales
amount) in seven chain supermarkets last year. Was advertising effective?
~ore
1 2
3
4
Ratio of advertising
expenditure(%)
0.8
2. 1 2.5
1.8
Ratio of operating
profit (%)
2.
5 3.4 3.7 3.2
Approach :
Draw up a scatter diagram based on the table.
y
6
5
.·
Ratio of operating profit
3
4
2
·.
5
6
3.1
4.0
4.3 6.3
2 3
4
x
7
1.0
2.3
Ratio of advertising expenditure
The scatter diagram suggests that profit increased with advertising expenditure.
The line connecting the plotted points in the diagram is called the regression
curve. In this case , it is almost linear and is therefore called linear regression.
This linear regression is expressed by
y
=
a
+
b ·
x
where
a
is called the linear
regression constant term and b the linear regression coefficient.
The correlation coefficient
(r)
is known to be within the range of - I
~ r ~
I.
Correlationship is positive when 0
<
r
~
I , negative when - I
~
r
<
0, and no
correlationship when
r
=
0 .
Now input data on the seven stores and obtain statistics.
4 1