Interpret Confidence and Prediction Intervals

question 21

Multiple Choice

Interpret confidence and prediction intervals.
-A sales manager was interested in determining if there is a relationship between
College GPA and sales performance (number of units sold in the previous month) among
Salespeople hired within the last year. The estimated regression equation fit to the data
Was found to be significant at α = 0.05. The 95% confidence interval for the number of
Units sold when GPA = 3.00 was determined to be 20.914 to 22.657. The correct
Interpretation is

• A) We can be 95% confident that the number of units sold per month by a particular salesperson with a college GPA of 3.00 is between 20.914 and 22.657 units.
• B) We can be 95% confident that the average number of units sold per month by salespersons with a college GPA of 3.00 is between 20.914 and 22.657 units.
• C) The number of units sold per month by a salesperson with a college GPA of 3.00 will be between 20.914 and 22.657 units 95% of the time.
• D)95% of the time the average number of units sold per month will be between 20.914 and 22.657 units.
• E) We can be 95% confident that each month between 20.914 and 22.657 units will be

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Definitions:

Cups Of Soup

A measure of quantity often used in food service to represent single servings of soup.

Trade

Trade involves the exchange of goods, services, or both, between parties, which can be within an economy (domestic trade) or between economies (international trade).

Comparative Advantage

The ability of an entity to produce a good or service at a lower opportunity cost than another entity.

Opportunity Cost

The price paid for not selecting the next most favorable alternative when a choice is made.