# Initial levels of advertising often bring a larger response in the market than later spending. In this example, advertising comes

## Question:

(a) Create a scatterplot for the level of sales on the number of shelf feet. Does the relationship appear linear? Do you think that it ought to be linear?

(b) Fit a linear regression equation to the data, regressing sales on the number of shelf feet. Does this fitted model make substantive sense?

(c) Consider a scatterplot that shows sales on the log of the number of shelf feet. Does the relationship seem more linear than in part (a)?

(d) Fit a regression of sales on the log of the number of shelf feet. Does this model provide a better description of the pattern in the data? What do the slope and intercept tell you?

(e) Compare the ft of the two models to the data. Can you rely on summary statistics like r2 and se?

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## Statistics For Business Decision Making And Analysis

**ISBN:** 9780321890269

2nd Edition

**Authors:** Robert Stine, Dean Foster

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