Question 2.58

2.58 Companies of the world

Refer to Exercise 1.118 (page 61), where we examined data collected by the World Bank on the numbers of companies that are incorporated and listed on their country’s stock exchange at the end of the year. In Exercise 2.10, you examined the relationship between these numbers for 2012 and 2002, and in Exercise 2.27, you found the correlation between these two variables.

  1. Find the least-squares regression equation for predicting the 2012 numbers using the 2002 numbers.
  2. Sweden had 332 companies in 2012 and 278 companies in 2002. Use the least-squares regression equation to find the predicted number of companies in 2012 for Sweden.
  3. Find the residual for Sweden.