The fast-food chain Burger Slim wants to introduce a new childrens meal. The company decides to test

Question:

The fast-food chain Burger Slim wants to introduce a new children’s meal. The company decides to test different meals at its 2261 franchises for their effect on total revenue. Each meal variation contains a slim burger and, depending on the franchise, some combination of soft drink (between 0.1 and 1.0 litre), salad, ice cream, and a toy. These are the variables:

• Revenue: Revenue through meal sales in the franchise [in MUs]

• Salad: Salad, 1 (salad); salad, 0 (no salad)

• Ice cream: Ice cream, 1 (ice cream); ice cream, 0 (no ice cream)

• Toy: Toy, 1 (toy); toy, 0 (no toy)

• Sz_Drink: Size of soft drink • Price: Price of meal You perform two regressions with the results in Fig. 10.21:

(a) Calculate R² from regression one.

(b) What is the adjusted R² needed for?

(c) Using regression one determine the average revenue generated by a meal that costs five euros and contains a slim burger, a 0.5 1 soft drink, a salad, and a toy.

(d) Using regression two determine which variable has the largest influence. Explain your answer.

(e) Compare the results of regressions one and two. Which of the solutions would you consider in a presentation for the client?

Figure 10.21