Six sales representatives made calls (7, 6, 8, 6, 1, 2) with corresponding sales turnovers ($1000): 11, 10, 14, 12, 8, 9. Using the least squares regression equation of turnover on number of calls, what is the gradient (slope) of the regression line, to 3 decimal places?

Model answer

0.675

Explanation

b = Sxy/Sxx = 27/40 = 0.675, so each additional call is associated with an increase of about $675 in turnover.

Derived from ZIMSEC Statistics Paper 1, November 2018, Q14

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