A shoe store developed the following estimated regression equation relating sales to inventory investment and advertising...

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Question

A shoe store developed the following estimated regression equation relating sales to inventory investment and advertising...

A shoe store developed the following estimated regression equation relating sales to inventory investment and advertising expenditures.

ŷ = 29 + 12x₁ + 7x₂

where

x₁	=	inventory investment ($1,000s)
x₂	=	advertising expenditures ($1,000s)
y	=	sales ($1,000s).

(a) Predict the sales (in dollars) resulting from a $14,000 investment in inventory and an advertising budget of $11,000.

$

A shoe store developed the following estimated regression equation relating sales to inventory investment and advertising expenditures. ŷ = 27 + 12x₁ + 6x₂ where

x₁	=	inventory investment ($1,000s)
x₂	=	advertising expenditures ($1,000s)
y	=	sales ($1,000s).

Predict the sales (in dollars) resulting from a $14,000 investment in inventory and an advertising budget of $10,000.

$

math Statistics-And-Probability

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Answer 1

Answer #1

The equation is given as:

ŷ = 29 + 12x1 + 7x2

So in order to predict sales for x1 = 14 and x2 = 11

So

ŷ = 29 + 12*14 + 7*11 = 274

So $ 274000 is the sales for the given inventory investment and advertising expenditures.

b)

Similarly for this equation :

ŷ = 27 + 12x1 + 6x2

x1 = 14

x2 = 10

ŷ = 27 + 12*14 + 6*10 = 255

So their will be $ 255000 sales for given inventory investment and advertising expenditures.

Add a comment

Answer 2

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