Retail Price Data for N = 60 Hard Disk Drives $y =$

question 110

Short Answer

Retail price data for n = 60 hard disk drives were recently reported in a computer magazine. Three variables were recorded for each hard disk drive: $y =$ Retail PRICE (measured in dollars)
$x _ { 1 } =$ Microprocessor SPEED (measured in megahertz)
(Values in sample range from 10 to 40 )
$x _ { 2 } = \mathrm { CHIP }$ size (measured in computer processing units)
(Values in sample range from 286 to 486 )
A first-order regression model was fit to the data. Part of the printout follows:
Parameter Estimates
$\begin{array}{lrllll}{\text { PARAMETER STANDARD }} & \text { T FOR 0: } \\\text { VARIABLE } & \text { DF } & \text { ESTIMATE } & \text { ERROR PARAMETER }=0 \text { PROB }>\text { |T| } =\\\text { INTERCEPT } 1 & -373.526392 & 1258.1243396-0.297 & 0.7676 \\\text { SPEED }\quad\quad\quad1 & 104.838940 & 22.36298195 4.688 & 0.0001 \\\text { CHIP } \quad\quad\quad\quad1 & 3.571850 & 3.89422935 0.917 & 0.3629\end{array}$

Identify and interpret the estimate for the SPEED $\beta$ -coefficient, $\hat { \beta } _ { 1 }$ .
A) $\hat { \beta } _ { 1 } = 105$ ; For every 1-megahertz increase in SPEED, we estimate PRICE $( y )$ to increase $\$ 105$ , holding CHIP fixed.
B) $\hat { \beta } _ { 1 } = 105$ ; For every $\$ 1$ increase in PRICE, we estimate SPEED to increase 105 megahertz, holding CHIP fixed.
C) $\hat { \beta } _ { 1 } = 3.57 ;$ For every 1 -megahertz increase in SPEED, we estimate PRICE to increase $\$ 3,57$ , holding CHIP fixed.
D) $\hat { \beta } _ { 1 } = 3.57$ ; For every $\$ 1$ increase in PRICE, we estimate SPPED to increase by about 4 megahertz, holding CHIP fixed.

• A) \(\hat { \beta } _ { 1 } = 105\); For every 1-megahertz increase in SPEED, we estimate PRICE \(( y )\) to increase \(\$ 105\), holding CHIP fixed.
• B) \(\hat { \beta } _ { 1 } = 105\); For every \(\$ 1\) increase in PRICE, we estimate SPEED to increase 105 megahertz, holding CHIP fixed.
• C) \(\hat { \beta } _ { 1 } = 3.57 ;\) For every 1 -megahertz increase in SPEED, we estimate PRICE to increase \(\$ 3,57\), holding CHIP fixed.
• D) \(\hat { \beta } _ { 1 } = 3.57\); For every \(\$ 1\) increase in PRICE, we estimate SPPED to increase by about 4 megahertz, holding CHIP fixed.

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Definitions:

Accumulated Depreciation

The aggregate depreciation charges applied to an asset since its initial utilization.

Worksheet

A paper or electronic document used to organize and simplify complex information, often used in accounting and financial analysis.

Income Statement Columns

Sections in an income statement that categorize financial data such as revenues, expenses, and net income over a specific period.

Net Loss

The amount by which expenses exceed revenues for a specific period, indicating a decrease in the owner's equity.