A Regression Model Between Sales (Y in $1000), Unit Price

question 62

Multiple Choice

A regression model between sales (y in $1000) , unit price (x₁ in dollars) , and television advertisement (x₂ in dollars) resulted in the following function: ​ = 8 - 4x₁ + 5x₂
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For this model, SSR = 3500, SSE = 1500, and the sample size is 20.The coefficient of the unit price indicates that if the unit price is

• A) increased by $1 (holding advertisement constant), sales are expected to increase by $4.
• B) decreased by $1 (holding advertisement constant), sales are expected to decrease by $4.
• C) increased by $1 (holding advertisement constant), sales are expected to increase by $4000.
• D) increased by $1 (holding advertisement constant), sales are expected to decrease by $4000.

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Definitions:

Tariff Revenue

Income that a government earns from imposing tariffs on imported goods.

Domestic Consumers

Individuals or households that consume goods and services within their own country, as opposed to purchasing imported goods.

Domestic Producers

Entities within a country that produce goods and services for the local market.

Import/Export

The practice of bringing goods or services into a country (import) and sending goods or services to another country (export).