Brewsky's Is a Chain of Micro-Breweries -
Based on the Data Derived from the Regression Analysis

question 68

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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Based on the data derived from the regression analysis, what are the estimated costs for 1,600 customer visits in a month? (CMA adapted)

• A) $6,125.
• B) $4,629.
• C) $3,328.
• D) $4,824.

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Definitions:

Purchase-Money Security Interest

A legal claim granted to lenders over items purchased, serving as collateral for the loan used to purchase the goods.

Possession Of Collateral

Holding or control over property or assets pledged as security for a loan or obligation.

Private Sale

A transaction of goods or property conducted directly between individuals or parties without the involvement of a public auction or open market.

Public Sale

The process of selling goods or assets to the highest bidder in an open and public manner.