Your boss assigns you a task to estimate the relationship between per capita income
and the percentage of labor force employed in the agricultural sector in ten
developing countries. Your data are:
Country A B C D E F G H I J
Per capital income (Y) 6 8 8 7 7 12 9 8 9 10
% Labor force in
agriculture
9 10 8 7 10 4 5 5 6 7
i. Plot the observation on the scatter and describe the pattern ofrelationship.
ii. What is the nature of the data set?
iii. Calculate the intercept and slope coefficients, and the coefficient of
determination.
iv. If the percent of the labor force in agriculture in another developingcountry was
8 percent, what level of per capita income (in thousands of U.S. dollars) would
you estimate that country had?
v. What level of labor should be used in agriculture to maintain per capital income at 13 ( US dollars)
i. The scatter plot of the data shows a negative relationship between per capita income and the percentage of labor force employed in the agricultural sector. As the per capita income increases, the percentage of labor force employed in the agricultural sector decreases.
ii. The data set is a bivariate data set.
iii. The intercept coefficient is -2.9, the slope coefficient is -0.5, and the coefficient of determination is 0.45.
iv. If the percent of the labor force in agriculture in another developing country was 8 percent, then the estimated per capita income would be 8.5 thousand US dollars.
v. To maintain per capita income at 13 (US dollars), the labor force should be used in agriculture at 4.5 percent.