Brewsky's Is a Chain of Micro-Breweries -
in a Regression Equation Expressed as Y = a the Costs

question 90

Multiple Choice

Brewsky's is a chain of micro-breweries. Managers are interested in the costs of the stores and believe that the costs can be explained in large part by the number of customers patronizing the stores. Monthly data regarding customer visits and costs for the preceding year for one of the stores have been entered into the regression analysis and the analysis is as follows:
$\begin{array}{llr} \text { Average monthly customer visits } &&1,462\\ \text { Average monthly total costs } &&\$4,629\\& \text { Regression Results} &\\ \text { Intercept } &&\$1,496\\ \text { b coefficient } &&\$2.08\\ \text { R }^{2} &&0.86814\\\end{array}$

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In a regression equation expressed as y = a + bx, how is the letter x best described? (CMA adapted)

• A) Fixed costs per each customer-visit.
• B) The observed store costs for a given month.
• C) The estimate of the number of new customer visits for the month.
• D) The observed customer visits for a given month.

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