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i just want to ask what is the concept behind letter c. does it means that, i need to subtract every x value by $20? if so, is it ok to have a negative value? or do you have any sugggestions? this is the first type of problem that I have dealt. letter a and letter b are simple. but im stuck to letter c. what is the idea behind this.

Thanks

2 Answers 2

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In part (c), you are being asked to predict the price of regular gasoline using the equation you found in part (a).

I'm not sure if you're having trouble with the wording in part (c)--"fell to \$20 per barrel" means to assume that the price is now at $20 per barrel. Notice that in 2004 it was at \$36.98.

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If the least-squares line is $y = ax + b$ where $x$ is the price of crude oil and $y$ is the price of unleaded gasoline, then the question is what would $y$ be if $x=20$. You certainly shouldn't be subtracting $20$ from all the $x$-values, nor otherwise altering them.