Question
A shoe store developed the following estimated regression equation relating sales to inventory investment and advertising expenditures. =21+12 x 1 +8 x 2 where x
A shoe store developed the following estimated regression equation relating sales to inventory investment and advertising expenditures.
=21+12x1+8x2
where
x1=inventory investment ($1,000s)x2=advertising expenditures ($1,000s)y=sales ($1,000s).
(a)
Predict the sales (in dollars) resulting from a $14,000investment in inventory and an advertising budget of $10,000.
$
(b)
Interpretb1andb2
in this estimated regression equation.
Sales can be expected to increase by $for every dollar increase in inventory investment when advertising expenditure is held constant. Sales can be expected to increase by$for every dollar increase in advertising expenditure when inventory investment is held constant.
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started