Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

5.A credit card company is trying to understand and even predict annual charges that a customer will make on their cards using 5 variables: annual

5.A credit card company is trying to understand and even predict annual charges that a customer will make on their cards using 5 variables: annual income (in $1000), household size, years of post-high school education (labeled simply "Education"), hours per week watching television (labeled "TV Hours") and age of the primary card holder.

They collect data on 100 randomly selected customers and measure the variables described above. They then perform a multiple regression analysis and find the results shown in the questions below.

Important Note: While the scenario above applies to all of the questions below, the output shown in different questions may change from question to question. Please be careful that you use the appropriate output for each question.

For this question, use the following multiple regression output (which may differ from the output in other questions, even though the variables are the same).

SUMMARY OUTPUT
Regression Statistics
Multiple R 0.645
R Square 0.416
Adjusted R Square 0.385
Standard Error 4599.979
Observations 100
ANOVA
df SS MS F Significance F
Regression 5 1415098336 283019667 13.375 7.595E-10
Residual 94 1989021846 21159807
Total 99 3404120182
Coefficients Standard Error t Stat P-value Lower 95% Upper 95%
Intercept 3176.846 2790.016 1.139 0.2577 -2362.796 8716.489
Annual Income ($1000) 119.665 16.134 7.417 5.240E-11 87.630 151.700
Household Size 592.620 220.534 2.687 0.0085 154.744 1030.496
Education -617.648 307.172 -2.011 0.0472 -1227.546 -7.751
TV Hours -7.574 29.487 -0.257 0.7978 -66.121 50.973
Age -22.418 42.243 -0.531 0.5969 -106.293 61.456

All other things being equal, how much do you estimate the annual charges will change for a unit increase in household size? A negative number means the predicted charges will decrease, while a positive number means they will increase.

Group of answer choices

It depends on what the current household size is.

$592.62

$220.53

-$592.62

-$220.53

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Brief Calculus & Its Applications

Authors: Larry J Goldstein, David C Lay, David I Schneider, Nakhle I Asmar

13th Edition

0321888510, 9780321888518

More Books

Students also viewed these Mathematics questions

Question

Explain the factors that influence peoples values.

Answered: 1 week ago

Question

Illustrate the link between business

Answered: 1 week ago