Question

1.

Management of a fast-food chain proposed the following regression model to predict sales at outlets:

y = β₀ + β₁x₁ + β₂x₂ + β₃x₃ + ε, where

y = sales ($1000s)

x₁= number of competitors within one mile

x₂= population (in 1000s) within one mile

x₃is 1 if a drive-up window is present, 0 otherwise

The following estimated regression equation was developed after 20 outlets were surveyed:

= 12.6 − 3.6x₁+ 7.0x₂+ 14.1x₃

Use this equation to predict sales for a store with 4 competitors, a population of 4300 within one mile, and a drive-up window;
round your answer to two decimal places and omit the $ symbol.

2.

You have run a simple regression on a sample with 21 observations, and obtained the following information:

SSR = 233
SST = 354

Calculate the value of the standard error of estimate, s

Round your answer to three decimal places

3.  

For a data set with n = 26 observations and k = 6 independent variables, use F-table to find the critical value for a test of overall significance with α = 2.5%

Show your answer with four decimal places.

Answer 1