A Regression Analysis Between Sales in $1000) and Price in Dollars)

question 48

Multiple Choice

A regression analysis between sales in $1000) and price in dollars) resulted in the following equation = 60 - 8X
$\hat { Y }$ The above equation implies that an

• A) increase of $1 in price is associated with a decrease of $8 in sales
• B) increase of $8 in price is associated with an decrease of $52,000 in sales
• C) increase of $1 in price is associated with a decrease of $52 in sales
• D) increase of $1 in price is associated with a decrease of $8000 in sales

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Definitions:

Accounts Receivable Turnover

A financial ratio that measures how efficiently a company collects revenue from its customers by comparing net credit sales to average accounts receivable.

Net Credit Sales

The total revenue from sales made on credit, minus returns and allowances, over a specific period.

Accounts Receivable

A financial record representing the money owed to a company by its customers for goods or services delivered on credit.

Profitability Ratio

A category of financial metrics used to assess a business's ability to generate earnings relative to its revenue, assets, equity, or other financial aspects.