Question

The sales prediction technique based on the correlation between sales and other factors—such as population density, per capita income, or family size—is

a) executive judgment.
b) time series analysis.
c) regression analysis.
d) a market test.
e) an expert survey.

Answer 1

The sales prediction technique that uses a correlation between sales and factors such as population density and income is called regression analysis option c, which is important for discerning the impact of multiple variables and predicting outcomes.

Step-by-step explanation:

The sales prediction technique based on the correlation between sales and other factors such as population density, per capita income, or family size is known as regression analysis option c. This statistical method is used to determine the strength and causality between a dependent variable (effect) and one or more independent variables (causes). For instance, regression analysis can help understand not only if the presence of fast food joints affects obesity rates but can also discern the impact of variables like ethnicity, income, and access to parks on obesity. Moreover, regression can predict outcomes, such as using a regression equation to estimate future sales or the impact of new businesses on crime rates in a neighborhood.