{Exercise 12.47} Data on advertising expenditures and revenue (in thousands of d

Question

{Exercise 12.47} Data on advertising expenditures and revenue (in thousands of dollars) for the Four Seasons Restaurant follow.

Advertising Expenditures: 1 2 4 6 10 14 20 Revenue: 20 33 45 41 53 54 55 Let x equal advertising expenditures and y equal revenue.

Complete the estimated regression equation below (to 2 decimals)

y = + x

Compute the following (to 1 decimal).

SSE

SST

SSR

MSR

MSE

Test whether revenue and advertising expenditures are related at a .05 level of significance.

Compute the F test statistic (to 2 decimals).

Explanation / Answer

The Regression equation is

y=a+bx

frm Excel

The Fitted model is

y=30.4+1.55(Expenditure)

SSE=31.28

SST=1002

SSR=691.72

MSR=691.72

MSE=62.05

F cal=(MSR/MSE)=11.14

P value=0.02

Hence P<0.05 we reject the H0. Hence claim is significant  

SUMMARY OUTPUT Regression Statistics Multiple R 0.830868 R Square 0.690342 Adjusted R Square 0.62841 Standard Error 7.877531 Observations 7 ANOVA df SS MS F Significance F Regression 1 691.7226 691.7226 11.14684 0.020582 Residual 5 310.2774 62.05549 Total 6 1002 Coefficients Standard Error t Stat P-value Lower 95% Upper 95% Lower 95.0% Upper 95.0% Intercept 30.39911 4.807253 6.323592 0.001458 18.04167 42.75655 18.04167 42.75655 Expenditures 1.547478 0.463499 3.338688 0.020582 0.356016 2.738939 0.356016 2.738939

Related Questions

Navigate

• Browse (All)
• Browse #
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.