What is the relationship between diamond price and carat size? 307 diamonds were sampled and a straight-line relationship was hypothesized between y = diamond price (in dollars) and x = size of
The diamond (in carats) . The simple linear regression for the analysis is shown below: Least Squares Linear Regression of PRICE
The model was then used to create confidence and prediction intervals for and for E(Y) when the carat size of the diamond was 1 carat. The results are shown here:
confidence interval for
prediction interval for
Which of the following interpretations is correct if you want to use the model to estimate for all 1 -carat diamonds?
A) We are confident that the price of a 1 -carat diamond will fall between and .
B) We are confident that the average price of all 1 -carat diamonds will fall between and .
C) We are confident that the average price of all 1 -carat diamonds will fall between and .
D) We are confident that the price of a 1-carat diamond will fall between and .
Correct Answer:
Verified
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