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Consider the regression model: Y=Bo+BD+BX + B3DX+E where: Y = per capita sales of a product in a sales territory (in $100,000); D =

Consider the regression model: Y=Bo+BD+BX + B3DX+E where: Y = per capita sales of a product in a sales territory (in $100,000); D = 1 if advertising level is high, 0 if advertising level is low; X = number of salespeople in the territory. Q1: Write the regression equation separately for high advertising and low advertising. Q2: Express the following hypothesis in terms of regression parameters: " If advertising level is low, then adding one more salesperson does not change sales on the average." Q3: Suppose the regression line is given by: Y=15+2.1*D+ 1.5*X+.5*D*X + If advertising level is high, what is the average increase in sales if you add one more salesperson?

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