1Auction Bids The author is a member of the board of directo

1.Auction Bids. The author is a member of the board of directors of a nonprofit organization that held a fund-raising auction. He recorded the opening bids suggested by the auctioneer and the final winning bids for several items. The amounts are listed below. Is there sufficient evidence to conclude that there is a linear correlation between the opening bids suggested by the auctioneer and the final winning bids?

Opening Bid

1500

500

500

400

300

Winning Bid

650

175

125

275

125

Solution

Ho: rho =0

H1: rho != 0

r=0.947

critical values = +/- 0.878

P- value = 0.015

There is sufficient evidence to support the claim that there is a linear correlation between the opening bids suggested by the auctioneer and the final winning bids.