Misinterpretations. An advertising agent who created a regression model using amount spent on Advertising to predict annual
Question:
Misinterpretations. An advertising agent who created a regression model using amount spent on Advertising to predict annual Sales for a company made these two statements.
Assuming the calculations were done correctly, explain what is wrong with each interpretation.
a) My R2 of 93% shows that this linear model is appropriate.
b) If this company spends $1.5 million on advertising, then annual sales will be $10 million.
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Related Book For
Business Statistics
ISBN: 9781292269313
4th Global Edition
Authors: Norean Sharpe, Richard De Veaux, Paul Velleman
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