MATLAB: An Introduction with Applications
MATLAB: An Introduction with Applications
6th Edition
ISBN: 9781119256830
Author: Amos Gilat
Publisher: John Wiley & Sons Inc
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The Dow Jones Industrial Average (DJIA) and the Standard & Poor's 500 (S&P 500) indexes are used as measures of overall movement in the stock market. The DJIA is based on the price
movements of 30 large companies; the S&P 500 is an index composed of 500 stocks. Some say the S&P 500 is a better measure of stock market performance because it is broader based.
Suppose the closing price for the DJIA and the S&P 500 for 144 days in a certain year are as provided in the file closingprices3.xlsx.
(a) Develop a scatter chart for these data with DJIA as the independent variable. What does the scatter chart indicate about the relationship between DJIA and S&P 500?
The scatter chart indicates there may be a positive linear relationship between DJIA and S&P 500.
The scatter chart indicates there may be no noticeable linear relationship between DJIA and S&P 500.
The scatter chart indicates there may be a negative linear relationship between DJIA and S&P 500.
(b) Develop an estimated linear regression equation showing how S&P 500 (y) is related to DJIA (x). What is the estimated linear regression model? (Round your numerical values to
four decimal places.)
ŷ=b0+b1 x
(c) What is the 95% confidence interval for the parameter ₁? (Round your answers to three decimal places.)
0
to 95
Based on this interval, what conclusion can you make about the hypotheses that the parameter ₁ is equal to zero? (Make your conclusion regardless of any validity concerns.)
Because this interval does
include zero, we reject
the hypothesis that ₁ = 0.
(d) What is the 95% confidence interval for the parameter Bo? (Round your answers to three decimal places.)
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Transcribed Image Text:The Dow Jones Industrial Average (DJIA) and the Standard & Poor's 500 (S&P 500) indexes are used as measures of overall movement in the stock market. The DJIA is based on the price movements of 30 large companies; the S&P 500 is an index composed of 500 stocks. Some say the S&P 500 is a better measure of stock market performance because it is broader based. Suppose the closing price for the DJIA and the S&P 500 for 144 days in a certain year are as provided in the file closingprices3.xlsx. (a) Develop a scatter chart for these data with DJIA as the independent variable. What does the scatter chart indicate about the relationship between DJIA and S&P 500? The scatter chart indicates there may be a positive linear relationship between DJIA and S&P 500. The scatter chart indicates there may be no noticeable linear relationship between DJIA and S&P 500. The scatter chart indicates there may be a negative linear relationship between DJIA and S&P 500. (b) Develop an estimated linear regression equation showing how S&P 500 (y) is related to DJIA (x). What is the estimated linear regression model? (Round your numerical values to four decimal places.) ŷ=b0+b1 x (c) What is the 95% confidence interval for the parameter ₁? (Round your answers to three decimal places.) 0 to 95 Based on this interval, what conclusion can you make about the hypotheses that the parameter ₁ is equal to zero? (Make your conclusion regardless of any validity concerns.) Because this interval does include zero, we reject the hypothesis that ₁ = 0. (d) What is the 95% confidence interval for the parameter Bo? (Round your answers to three decimal places.) to
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