Hogs & Dawgs is an ice cream parlor on the border of north-central Louisiana and southern Arkansas that serves 43 flavors of ice creams, sherbets, frozen yogurts, and sorbets. During the summer Hogs & Dawgs is open from 1:00 p.m. to 10:00 p.m. on Monday through Saturday, and the owner believes that sales change systematically from hour to hour throughout the day. She also believes her sales increase as the outdoor temperature increases. Hourly sales and the outside temperature at the start of each hour for the last week are provided in the file IceCreamSales.
- a. Construct a time series plot of hourly sales and a
scatter plot of outdoor temperature and hourly sales. What types of relationships exist in the data? - b. Use a simple regression model with outside temperature as the causal variable to develop an equation to account for the relationship between outside temperature and hourly sales in the data. Based on this model, compute an estimate of hourly sales for today from 2:00 p.m. to 3:00 p.m. if the temperature at 2:00 p.m. is 93°F.
- c. Use a multiple linear regression model with the causal variable outside temperature and dummy variables as follows to develop an equation to account for both seasonal effects and the relationship between outside temperature and hourly sales in the data in the data:
Hour1 = 1 if the sales were recorded between 1:00 p.m. and 2:00 p.m., 0 otherwise;
Hour2 = 1 if the sales were recorded between 2:00 p.m. and 3:00 p.m., 0 otherwise;
M
Hour8 = 1 if the sales were recorded between 8:00 p.m. and 9:00 p.m., 0 otherwise.
Note that when the values of the 8 dummy variables are equal to 0, the observation corresponds to the 9:00-to-l0:00-p.m. hour.
Based on this model, compute an estimate of hourly sales for today from 2:00 p.m. to 3:00 p.m. if the temperature at 2:00 p.m. is 93°F.
- d. Is the model you developed in part (b) or the model you developed in part (c) more effective? Justify your answer.
Want to see the full answer?
Check out a sample textbook solutionChapter 8 Solutions
Essentials of Business Analytics (MindTap Course List)
- The owner of an apartment building can rent all 50 apartments if she charges $1,700 per month, but she rents one fewer apartment for each $50 increase in monthly rent. (a) Construct a table that gives the revenue generated if she charges $1,700, $1,750, and $1,800. Total Revenue No. of Apts 50 49 48 Rent $1,700 $ 85000 $1,750 $ 85750 $1,800 $ 86400 Need Help? ✓ Excellent job! (b) Does her revenue from apartment rentals increase or decrease as she increases the rent from $1,700 to $1,800? o revenue increases revenue decreases Read It ✓ Great job. ✓ Way to go! Nice work. (c) Write an equation that gives the revenue R, from apartment rentals if she makes x increases of $50 in the rent. R(x) = -50x² +800x+8500 X (d) Find the rent she should charge to maximize her revenue. $2100 ✓per montharrow_forwardA please. Scatter diagram included.arrow_forwardA friend who lives in Los Angeles makes frequent consulting trips to Washington, D.C.;50% of the time she travels on airline #1, 30% of the time on airline #2, and the remaining 20% of the time on airline #3. For airline #1, flights are late into D.C.30% of the time and late into L.A.10% of the time. For airline #2,these percentages are 25% and 20%,whereas for airline #3 the percentages are 40% and 25%.If we learn that on a particular trip she arrived late at exactly one of the two destinations, what are the posterior probabilities of having flown on airlines #1,#2, and #3? Assume that the chance of a late arrival in L.A.is unaffected by what happens on the flight to D.C. [ Hint: From the tip of each first generation branch on a tree diagram, draw three second-generation branches labeled, respectively, 0 late,1late, and 2 late.]arrow_forward
- please do a and c !!!!arrow_forward. In 2010, of a total of 67,000 rooms on the Las Vegas Strip, Caesars Entertainment managed 22,880, while MGM Resorts managed over 12,000. However, owing to the Great Recession and new hotel openings, between 2008 and 2010, MGM's hotel occupancy decreased from 92% to 89%, while its average daily room rate fell from $148 to $108. Meanwhile, CityCenter, managed by MGM Resorts, and the Cosmopolitan opened with 4,000 and 3,000 rooms respectively, and the 1,720-room Sahara closed. (Sources: Caesars Entertainment Corp., Annual Report 2010; MGM Resorts, Annual Report 2010; "Sahara's closure on May 16 will mark `the end of an era'," Las Vegas Sun, March 11, 2011.) (a) Using a suitable figure, explain how the opening of CityCenter and the Cosmopolitan affects the residual demand for an existing hotel and how it should adjust prices. (b) If MGM Resorts had not reduced its room rates, what would have been the effect on occupancy? (c) Use the Cournot model to explain…arrow_forwardDoctor’s care is a walk-in clinic, with locations in Georgetown mocks corner, and Aynor, at which patients may receive treatment for minor injuries, colds, and flu, as well as physical examinations. The following chart reports the number of patients treated in each of the three locations last month. Describe the number of patients served at the three locations each day. What are the maximum and minimum numbers of patients served at each of the locations? What is the average for each day?arrow_forward
- A researcher believed that the number of rental cars in service by a car rental company would have an impact on the total annual revenue for that car rental company. Five small car rental companies were surveyed, with the number of Cars in service recorded in units of 1000 (so if a car rental company had 54000 cars in service, a 54 would be recorded) and Annual Revenue measured in millions of dollars (so an Annual Revenue of $10,000,000 would be recorded as 10). The data follows: Cars (1,000s) Annual Revenue ($ millions)11.5 118 10.0 135 9.0 100 5.5 37 3.3 32 Part of the Excel-generated Simple Linear Regression output is provided below: ANOVA df SS MS F Significance F Regression 1 7891.863897 7891.863897 22.91180151 0.017339231 Residual 3 1033.336103 344.4453677 Total 4 8925.2 Coefficients Standard Error t Stat P-value Intercept -19.12490108 23.1658578…arrow_forwardA researcher believed that the number of rental cars in service by a car rental company would have an impact on the total annual revenue for that car rental company. Five small car rental companies were surveyed, with the number of Cars in service recorded in units of 1000 (so if a car rental company had 54000 cars in service, a 54 would be recorded) and Annual Revenue measured in millions of dollars (so an Annual Revenue of $10,000,000 would be recorded as 10). The data follows: Cars (1000s) Annual Revenue ($ millions)11.5. 11810.0. 1359.0. 1005.5. 373.3. 32 Part of the Excel-generated Simple Linear Regression output is provided below: ANOVA df SS MS F Significance F Regression 1 7891.863897 7891.863897 22.91180151 0.017339231 Residual 3 1033.336103 344.4453677 Total 4 8925.2…arrow_forwardA researcher believed that the number of rental cars in service by a car rental company would have an impact on the total annual revenue for that car rental company. Five small car rental companies were surveyed, with the number of Cars in service recorded in units of 1000 (so if a car rental company had 54000 cars in service, a 54 would be recorded) and Annual Revenue measured in millions of dollars (so an Annual Revenue of $10,000,000 would be recorded as 10). The data follows: Cars (1000s) Annual Revenue ($ millions)11.5 118 10.0 135 9.0 100 5.5 37 3.3 32 Part of the Excel-generated Simple Linear Regression output is provided below: ANOVA df SS MS F Significance F Regression 1 7891.863897 7891.863897 22.91180151 0.017339231 Residual 3 1033.336103 344.4453677 Total 4 8925.2…arrow_forward
- A researcher believed that the number of rental cars in service by a car rental company would have an impact on the total annual revenue for that car rental company. Five small car rental companies were surveyed, with the number of Cars in service recorded in units of 1000 (so if a car rental company had 54000 cars in service, a 54 would be recorded) and Annual Revenue measured in millions of dollars (so an Annual Revenue of $10,000,000 would be recorded as 10). The data follows: Cars (1000s) Annual Revenue ($ millions)11.5 118 10.0 135 9.0 100 5.5 37 3.3 32 Part of the Excel-generated Simple Linear Regression output is provided below: Regression Statistics Multiple R 0.940331133 R Square 0.884222639 Adjusted R Square 0.845630185 Standard Error 18.55923942…arrow_forwardSuppose, 1 Dollar = 100 Cents. Convert the prices of all items in the menu from dollar ($) to cent. Iteam Description Price Chicken Burger bhicken burger with a served a coleslaw, burger sauce and cheddar cheese $4 beef sandwich served with a hot chilli sauce onion rings with served garlic mayo, jalapeno cheese and hot chilli sauce beef stake with served garlic mayo and mashed potato Beef Sandwich $7 Onion Rings $2 Beef Steak $23 Potato Wedges potato wedges with served garlic mayo $2arrow_forwardAtlanta Airlines routinely overbooks its flight from At- lanta to Boston. Overbooking discounted seats can be expensive because providing a bumped passenger with a last-minute flight on a competing carrier can cost $450. A 120-passenger jet costs about $6000 to operate from Atlanta to Boston. The average ticket price is $300. a. Given the frequency of no-shows in the following table, how many seats should be overbooked? b. Atlanta Air offers special rates on its Atlanta/Boston route for the holidays. How would a $200 ticket price af- fect the number of seats overbooked?arrow_forward
- MATLAB: An Introduction with ApplicationsStatisticsISBN:9781119256830Author:Amos GilatPublisher:John Wiley & Sons IncProbability and Statistics for Engineering and th...StatisticsISBN:9781305251809Author:Jay L. DevorePublisher:Cengage LearningStatistics for The Behavioral Sciences (MindTap C...StatisticsISBN:9781305504912Author:Frederick J Gravetter, Larry B. WallnauPublisher:Cengage Learning
- Elementary Statistics: Picturing the World (7th E...StatisticsISBN:9780134683416Author:Ron Larson, Betsy FarberPublisher:PEARSONThe Basic Practice of StatisticsStatisticsISBN:9781319042578Author:David S. Moore, William I. Notz, Michael A. FlignerPublisher:W. H. FreemanIntroduction to the Practice of StatisticsStatisticsISBN:9781319013387Author:David S. Moore, George P. McCabe, Bruce A. CraigPublisher:W. H. Freeman