A Regression Analysis Between Sales Y in $1000) and Advertising $\hat { Y }$

question 79

Multiple Choice

A regression analysis between sales Y in $1000) and advertising X in dollars) resulted in the following equation $\hat { Y }$ = 30,000 + 4 X
The above equation implies that an

• A) increase of $4 in advertising is associated with an increase of $4,000 in sales
• B) increase of $1 in advertising is associated with an increase of $4 in sales
• C) increase of $1 in advertising is associated with an increase of $34,000 in sales
• D) increase of $1 in advertising is associated with an increase of $4,000 in sales

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Definitions:

Moon Illusion

A perceptual phenomenon in which the Moon appears larger near the horizon than it does higher up in the sky.

Horizon

The line where the earth's surface and the sky appear to meet, often used metaphorically to denote the limit of a person's knowledge, experience, or interest.

Bright

Having high intelligence or quick intellectual capacity.

Perceptual Set

A psychological predisposition or readiness to perceive certain features of the environment while ignoring others.