How closely does the number of trading accounts relate to th

How closely does the number of trading accounts relate to the total assets of the 10 largest online stock brokerages/

Consruct a scatterplot with assets on vertical axis.

Brokerage Accounts (1000) Assets ($ billions)
Ameritrade 428 19.5
Charles Schwab 2500 219.0
Datek 205 5.5
Discover 134 5.9
DLJ Direct 590 11.2
E* Trade 909 21.1
Fidelity 2300 160.0
National Discount Brokers 125 6.8
Suretrade 130 1.3
TD Waterhouse 615 38.8

(a) Does the wording of the initial question in this exercise indicate which variable should be treated as the response?

(b) Construct a scatterplot with Assets on the vertical axis and Accounts on the horizontal axis.

(c) Comment on the form, direction, and strength of the relationship between Assets and Accounts.

(d) Two brokerages stand out from the rest of the data. Identify these two brokerages by putting their names near their respective data points in your scatterplot.

Solution

(a) From the given data, number of accounts depends on the Assets, so response variable is Assets.

(b) We construct a scatterplot with Assets on the vertical axis and Accounts on the horizontal axis

(c) As per diagram, as accounts increases the assets also increased. Therefore, accounts and assets are positive correlation. Also the points are closed to each other, therefore these variables show good relation.

(d) Charles Schwab and Fidelity are two brokerages points vary from rest of the data.