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Mark Price, the new productions manager for Speakers and Company, needs to find out which variable most affects the demand for their line of stereo

Mark Price, the new productions manager for Speakers and Company, needs to find out which variable most affects the demand for their line of stereo speakers. He is uncertain whether the unit price of the product or the effects of increased marketing are the main drivers in sales and wants to use regression analysis to figure out which factor drives more demand for its particular market. Pertinent information was collected by an extensive marketing project that lasted over the past 12 years and was reduced to the data that follow:

YEAR UNIT SALES (THOUSANDS) PRICE $/UNIT ADVERTISING ($000)
1 375 279 616
2 675 220 830
3 875 217 1,106
4 1,296 206 1,403
5 1,148 220 1,204
6 1,175 194 1,296
7 875 221 874
8 1,106 203 1,106
9 972 226 695
10 1,239 217 874
11 874 221 695
12 805 248 695

a. Perform a regression analysis based on these data using Excel. (Negative values should be indicated by a minus sign. Round your answers to 4 decimal places.)

image text in transcribed

c. Predict average yearly speaker sales for Speakers and Company based on the regression results if the price was $275 per unit and the amount spent on advertising (in thousands) was $875. (Enter your answer in thousands. Round your intermediate calculations and final answer to 2 decimal places.)

image text in transcribed y bar = Forecasted sales thousand units

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