Statistical Techniques in Business and Economics, 16th Edition
16th Edition
ISBN: 9780078020520
Author: Douglas A. Lind, William G Marchal, Samuel A. Wathen
Publisher: McGraw-Hill Education
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Chapter 13, Problem 1SR
a.
To determine
Identify the dependent variable and independent variable.
a.
Expert Solution
Answer to Problem 1SR
The dependent variable is the ‘sales revenue’ and the independent variable is the ‘advertising expense’.
Explanation of Solution
Data on the number of times the advertisement was aired and digital camera sales are given.
Independent variable:
The variable that can be used to predict the values of other variable is called an independent variable.
Dependent variable:
The variable that can be predicted by other variables is called a response variable or a dependent variable.
Here, the variable ‘sales revenue’ can be predicted using the variable ‘advertising expense’. Therefore, the dependent variable is the ‘sales revenue’ and the independent variable is the ‘advertising expense’.
b.
To determine
Construct a
b.
Expert Solution
Answer to Problem 1SR
The scatter diagram of the data is represented below:
Explanation of Solution
Calculation:
The scatterplot of the data is as follows:
Software Procedure:
Step-by-step procedure to obtain the scatterplot using Mega Stat software:
- In an EXCEL sheet enter the data values of x and y.
- Go to Add-Ins > Mega Stat >
Correlation /Regression > Scatterplot. - Enter horizontal axis as $A$1:$A$5 and vertical axis as $B$1:$B$5.
- Click on OK.
The scatterplot of the data shows an increasing trend.
c.
To determine
Find the
c.
Expert Solution
Answer to Problem 1SR
Thus, the correlation coefficient is 0.965.
Explanation of Solution
Calculation:
Software procedure:
Step-by-step procedure to obtain the correlation matrix using Mega Stat software:
- In an EXCEL sheet enter the data values of x and y.
- Go to Add-Ins > Mega Stat > Correlation/Regression > Correlation matrix.
- Enter Input
Range as $A$1:$b$5. - Click on OK.
Output obtained using Mega Stat is given as follows:
Thus, the correlation coefficient is 0.965.
d.
To determine
Interpret the strength of the correlation coefficient.
d.
Expert Solution
Explanation of Solution
From Part (c), the correlation coefficient is 0.965. Since the correlation coefficient is positive and close to 1, there is a strong
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Students have asked these similar questions
Reliable Furniture is a family business that has been selling to retail customers in the Oakville area for many years. It advertises extensively on radio and TV, emphasizing their its prices and easy credit terms. The owner would like to review the relationship between sales and the amount spent on advertising. Below is information on sales and advertising expense for the last four months.
Ad Exp.
Sales Rev.
Month
($ in 000)
($ in 000)
July
2
7
August
1
3
September
3
8
October
4
10
a) Determine the regression equation.
b) Interpret the values of a and b.
c) Estimate sales when $3 thousand is spent on advertising. Include the 95% confidence interval for average X
d) Determine the coefficient of correlation.
Reliable Furniture is a family business that has been selling to retail customers in the Oakville area for many years. It advertises extensively on radio and TV, emphasizing their its prices and easy credit terms. The owner would like to review the relationship between sales and the amount spent on advertising. Below is information on sales and advertising expense for the last four months.
Ad Exp.
Sales Rev.
Month
($ in 000)
($ in 000)
July
2
7
August
1
3
September
3
8
October
4
10
G-9 B continued Questions from G-9
e) Reproduce the excel output manually.
f) Interpret the strength of the correlation coefficient.
g) Determine the coefficient of determination. Interpret.
h) Test the significance of the Coefficient of Correlation
i) Test the significance of the slope coefficients of the regression equation.
a. Predict the sales resulting from a $15,000 investment in inventory and an advertising budget of $10,000.
Chapter 13 Solutions
Statistical Techniques in Business and Economics, 16th Edition
Ch. 13 - Prob. 1SRCh. 13 - Prob. 1ECh. 13 - Prob. 2ECh. 13 - Bi-lo Appliance Super-Store has outlets in several...Ch. 13 - Prob. 4ECh. 13 - Prob. 5ECh. 13 - The owner of Maumee Ford-Volvo wants to study the...Ch. 13 - Prob. 2SRCh. 13 - Prob. 7ECh. 13 - Prob. 8E
Ch. 13 - Prob. 9ECh. 13 - Prob. 10ECh. 13 - Prob. 11ECh. 13 - Prob. 12ECh. 13 - Prob. 3SRCh. 13 - Prob. 13ECh. 13 - Prob. 14ECh. 13 - Prob. 15ECh. 13 - Prob. 16ECh. 13 - Prob. 17ECh. 13 - Prob. 18ECh. 13 - Prob. 19ECh. 13 - Prob. 20ECh. 13 - Prob. 4SRCh. 13 - Prob. 21ECh. 13 - Prob. 22ECh. 13 - Prob. 23ECh. 13 - Prob. 24ECh. 13 - Prob. 5SRCh. 13 - Prob. 25ECh. 13 - Prob. 26ECh. 13 - Prob. 27ECh. 13 - Prob. 28ECh. 13 - Prob. 29ECh. 13 - Prob. 30ECh. 13 - Prob. 6SRCh. 13 - Prob. 31ECh. 13 - Prob. 32ECh. 13 - Prob. 33ECh. 13 - Refer to Exercise 16. a. Determine the .95...Ch. 13 - Prob. 35ECh. 13 - A regional commuter airline selected a random...Ch. 13 - Prob. 38CECh. 13 - Prob. 39CECh. 13 - Prob. 40CECh. 13 - The table below shows the number of cars (in...Ch. 13 - Prob. 42CECh. 13 - Prob. 43CECh. 13 - Prob. 44CECh. 13 - The manufacturer of Cardio Glide exercise...Ch. 13 - Prob. 46CECh. 13 - Prob. 47CECh. 13 - Prob. 48CECh. 13 - Prob. 49CECh. 13 - Mr. William Profit is studying companies going...Ch. 13 - Prob. 51CECh. 13 - Prob. 52CECh. 13 - Prob. 53CECh. 13 - Prob. 54CECh. 13 - A regression analysis relating the current market...Ch. 13 - Prob. 56CECh. 13 - Prob. 57CECh. 13 - A consumer buying cooperative tested the effective...Ch. 13 - Prob. 59CECh. 13 - Prob. 60CECh. 13 - TravelAir.com samples domestic airline flights to...Ch. 13 - Prob. 62DECh. 13 - Refer to the Baseball 2012 data, which reports...Ch. 13 - Prob. 64DE
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