A manager uses regression to express sales as a function of advertising expendit

Question

A manager uses regression to express sales as a function of advertising expenditures (X1), and per capita income (X2) in your sales area. The following multiple linear regression equation is developed: Y = 10 + .51X1 + .45X2 The coefficient of determination is .96 Determine which of the following conclusions is valid regarding the coefficient of determination: More analysis is needed. The coefficient of determination leaves much unexplained. The regression line fits the data used in the sample very well. There is a strong indication of the relationship of the two variables with sales. The coefficient of determination is positive because the constant term is positive. The coefficient of determination should always be greater than one.

Explanation / Answer

Here, Coefficient of determination is 0.96. Therefor The regression line fits the data used in the sample very well.

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