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Q. Carpet City wants to develop a means to forecast its carpet sales. Store manager believes that store's sales are directly related to number of new housing starts in town. Manager has gathered data from county records on monthly house construction permits also from store records on monthly sales.
These data are as follows:
Monthly Carpet Monthly ConstructionSales (1,000 yd.) Permits:5 2110 354 103 128 162 912 4111 159 1814 26
a. Develop a linear regression model for se data also forecast carpet sales if 30 construction permits for new homes are filed.
b. Determine strength of causal relationship between monthly sales also new home construction by using correlation.
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