Answer to Question #5488 in Statistics and Probability for Kendra Leatherwood

Question

AJ AUCTION sells art drawings of little known artist at auction. The dealer is interested in the relationship between the final sale price ($) (Y) and the number of persons bidding on the drawing (X). A random sample of 20 drawing is selected.

Correlations (Pearson)
Correlation of salepric and bidders = 0.974

Regression Analysis

The regression equation is
salepric = 1008 + 324 bidders

Predictor Coef Stdev t ratio p
Constant 1007.6 214.5 4.70 0.000
bidders 324.11 17.90 18.11 0.000

s = 320.2 R sq = 94.8% R sq(adj) = 94.5%

Fit Stdev.Fit 95.0% C.I. 95.0% P.I.
4248.7 75.3 (4090.4, 4406.9) (3557.4, 4940.0)

Determine the index of determination and interpret this value.