Using the data in given problem, conduct the hypothesis test for the existence of a linear correlation between the two variables. Use α = 0.01.
Problem
An article in Worth discusses the immense success of one of the world's most prestigious cars, the Aston Martin Vanquish. This car is expected to keep its value as it ages. Although this model is new, the article reports resale values of earlier Aston Martin models over various decades.
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Decade:
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1960s
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1970s
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1980s
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1990s
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2000s
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Present value of Aston Martin Model (average)
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$180,000
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$40,000
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$60,000
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$160,000
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$200,000
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Based on these limited data, is there a relationship between age and average price of an Aston Martin? What are the limitations of this analysis? Can you think of some hidden variables that could affect what you are seeing in the data?