A Local Tire Dealer Wants to Predict the Number of Tires

question 14

Short Answer

A local tire dealer wants to predict the number of tires sold each month. He believes that the number of tires sold is a linear function of the amount of money invested in advertising. He randomly selects 6 months of data consisting of tire sales (in thousands of tires) and advertising expenditures (in thousands of dollars). Based on the data set with 6 observations, the simple linear regression equation of the least squares line is ŷ = 3 + 1x.
∑X = 24
∑X² = 124
∑Y = 42
∑Y² = 338
∑XY = 196
MSE = 4
Use the least squares regression equation and estimate the monthly tire sales when advertising expenditures = $4,000.

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Definitions:

Enlightenment Thinkers

Philosophers and intellectuals of the 18th century Enlightenment period who emphasized reason, science, and individual rights over tradition and authority.

Traditional Authorities

denote individuals or institutions that wield power through customs, traditions, or cultural consensus.

Vilfredo Pareto

An Italian economist and sociologist known for his contributions to economic theory and the Pareto principle, also known as the 80/20 rule.

Interdependent Parts

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