Question

A regression analysis between sales y in $1000) and advertising (x in $100) resulted in the following squares line:y-82 +7x. This implies that if advertising is $900, then the predicted amount of sal dollars) is:

a. $6,382
b. $88,300
c. $145,000
d. $82,063
e. 6382000

Answer 1

The correct option is C) $145,000

Explanation:

Consider the provided regression.

`y=82 +7x`

sales y in $1000 and advertising x in $100

We have given that they spent $900 in advertising.

That means substitute x=9 in above regression because x is in $100.

`y=82 +7(9)`

`y=82 +63`

`y=145`

It is given that y in $1000.

That means the total sale is 145×$1000=$145000.

Hence, the correct option is C) $145,000