Question
Some members of management of the Fairface Cosmetics Firm believe that demand for its products is related to the promotional activities of local stores where
Some members of management of the Fairface Cosmetics Firm believe that demand for its products is related to the promotional activities of local stores where the cosmetics are sold. However, others in management believe that other factors, such as local demographics are stronger determinants of demand behavior. The following data for local annual promotional expenditures for Fairface products and local annual unit sales for Fairface lip gloss have been collected at random from different localities. Would it be appropriate to use this data to predict the sales if the store spends $12,000 annually on promotions ? Why or why not?
Sales Units(1000s) | Promotional Exp ($1000s) |
1.6 | $10.35 |
3.1 | $15.30 |
3.5 | $18.20 |
5.7 | $25.30 |
6.3 | $30.10 |
7.2 | $37.82 |
7.3 | $33.10 |
8.9 | $25.98 |
9.1 | $39.90 |
10.2 | $21.14 |
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