The financial manager at Choice Clothing noticed that the company's sales revenues (Y) (in 1,000) were not the same from month to month. The marketing manager established that the company's advertising expenditures (X) (in 1,000) also varied from month to month. They were interested to determine whether a relationship existed between sales and advertising expenditure during 16 months. The slope and intercept were computed and the regression equation is y=110.02+2.32x. What is the estimated monthly sales revenue (in rands) if the company invests R89,160 in advertising in a particular month (rounded off to two decimals)? A. R206 961.22
Correlation
Correlation defines a relationship between two independent variables. It tells the degree to which variables move in relation to each other. When two sets of data are related to each other, there is a correlation between them.
Linear Correlation
A correlation is used to determine the relationships between numerical and categorical variables. In other words, it is an indicator of how things are connected to one another. The correlation analysis is the study of how variables are related.
Regression Analysis
Regression analysis is a statistical method in which it estimates the relationship between a dependent variable and one or more independent variable. In simple terms dependent variable is called as outcome variable and independent variable is called as predictors. Regression analysis is one of the methods to find the trends in data. The independent variable used in Regression analysis is named Predictor variable. It offers data of an associated dependent variable regarding a particular outcome.
The financial manager at Choice Clothing noticed that the company's sales revenues (Y) (in 1,000) were not the same from month to month. The marketing manager established that the company's advertising expenditures (X) (in 1,000) also varied from month to month. They were interested to determine whether a relationship existed between sales and advertising expenditure during 16 months. The slope and intercept were computed and the regression equation is y=110.02+2.32x. What is the estimated monthly sales revenue (in rands) if the company invests R89,160 in advertising in a particular month (rounded off to two decimals)?
- A. R206 961.22
- B. R206.85
- C. R316.87
- D. R316 871.20
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