The Following Is Part of the Results of a Regression

question 129

Essay

The following is part of the results of a regression analysis involving sales Y in millions of dollars), advertising expenditures X1 in thousands of dollars), and number of salespeople X2) for a corporation. The regression was performed on a sample of 10 observations.
$\begin{array}{lr}&\text { Coefilicient }&\text { Standard Error }\\\text { Intercept } & 40.00 & 7.00 \\X_{1} & 8.00 & 2.50 \\X_{2} & 6.00 & 3.00\end{array}$
a. If the company uses $40,000 in advertisement and has 30 salespersons, what are the expected sales? Give your answer in dollars.
b. At α = 0.05, test for the significance of the coefficient of advertising.
c. At α = 0.05, test for the significance of the coefficient of the number of salespeople.

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Definitions:

Market Size

The total volume of a product or service that is available for purchase within a particular market, often measured in terms of sales value or volume.

Design Pathway

A pathway that can uncover high-value opportunities because the entrepreneur is focusing on unmet needs of customers, specifically latent needs.

Effectuating Opportunities

The act of identifying and acting upon potential business opportunities by mobilizing resources and strategies.

Prior Knowledge

The information and understanding a person already possesses before being exposed to new learning or experiences.