Question

The XYZ Inc. i considering to predict the sales revenue for one of their product lines...

The XYZ Inc. i considering to predict the sales revenue for one of their product lines using advertising expenditure. Sale is recorded thousands of dollars and advertising expenditures is recorded in hundreds of dollars.

The data follow:

                   Sales             Adv. Exp.                                                                                                                               2                    1

                     3                   2

                     5                    3

                     5                    4

                     6                    6

                     9                    6

                  10                    7

  1. Set up a scatter diagram. Is there a linear relationship between Sales and Advertising Expenditures?
  2. Use the least-squares method to find the regression coefficients, and plot the regression line.
  3. Interpret the meaning of the regression coefficients in this problem.
  4. Estimate the average sale if the Advertising Expenditures is 700.
  5. Compute the coefficient of determination and interpret its meaning in this problem.
  6. Compute the coefficient of correlation.
Math   Statistics-And-Probability   
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Answer #1

a)

There is linear relationship between sales and advertising expenditure .

b)

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