A manager at a car wash company in North Carolina wants to determine which promotions improve...
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A manager at a car wash company in North Carolina wants to determine which promotions improve sales. He has information on sales, price discounts, and advertising expenditures on Radio and Newspaper in 40 North Carolina counties. He used the three models to test the effects on sales. (1) Sales= B0 + B1Discount + ɛ; (2) Sales= B0 + B2Radio+ B3Newspaper+ ɛ; (3) Sales= B0 + B1Discount + B2Radio+ B3Newspaper+ ɛ. The estimated results are summarized in the following table. (p-value in parenthesis) Variable Model (1) Model (2) Model (3) 43.454 10.686 6.702 Intercept (0.000) (0.248) (0.356) 0.402 0.342 Discount (0.000) (0.000) 6.514 6.062 Radio (0.003) (0.001) 11.304 9.397 Newspaper (0.000) (0.000) Se 7.579 7.412 5.793 R-square 0.350 0.395 0.640 Adjusted R-square 0.610 0.333 0.362 With model (2), if newspaper spending keeps at the same level, what is the effect on sales if radio advertising increases by 2 units? Select one: a. 33.24 b. 22.68 C. 39.08 d. 13.03 A manager at a car wash company in North Carolina wants to determine which promotions improve sales. He has information on sales, price discounts, and advertising expenditures on Radio and Newspaper in 40 North Carolina counties. He used the three models to test the effects on sales. (1) Sales= B0 + B1Discount + ɛ; (2) Sales= B0 + B2Radio+ B3Newspaper+ ɛ; (3) Sales= B0 + B1Discount + B2Radio+ B3Newspaper+ ɛ. The estimated results are summarized in the following table. (p-value in parenthesis) Variable Model (1) Model (2) Model (3) 43.454 10.686 6.702 Intercept (0.000) (0.248) (0.356) 0.402 0.342 Discount (0.000) (0.000) 6.514 6.062 Radio (0.003) (0.001) 11.304 9.397 Newspaper (0.000) (0.000) Se 7.579 7.412 5.793 R-square 0.350 0.395 0.640 Adjusted R-square 0.610 0.333 0.362 With model (2), if newspaper spending keeps at the same level, what is the effect on sales if radio advertising increases by 2 units? Select one: a. 33.24 b. 22.68 C. 39.08 d. 13.03
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Mathematical Statistics with Applications in R
ISBN: 978-0124171138
2nd edition
Authors: Chris P. Tsokos, K.M. Ramachandran
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