Using the Output Below, Which Is the Correct Interpretation of the Coefficient

question 14

Multiple Choice

Using the output below, which is the correct interpretation of the coefficient of Average Bonus? Response Variable is Turnover Rate
$\mathrm { R } -$ squared $= 79.6 \%$

$\begin{array} { l r r r r } \text { Predictor } & \text { Coef } & \text { SE Coef } & \text { T } & \text { P } \\ \text { Constant } & 2.1005 & 0.7826 & 15.46 & 0.000 \\ \text { Trust Index } & - 0.07149 & 0.01966 & - 3.64 & 0.001 \\ \text { Average Bonus } & - 0.0007216 & 0.0001481 & - 4.87 & 0.000 \end{array}$

• A)For every additional $10,000 dollars in Average Bonus, the predicted Turnover Rate will go down about 7.2%.
• B)For every additional $10,000 dollars in Average Bonus, the predicted Turnover Rate will go up about 7.2%.
• C)For every additional $10,000 dollars in Average Bonus, and taking account of the other predictor (Trust Index), the predicted Turnover Rate will go down about 7.2%.
• D)For every additional $10,000 dollars in Average Bonus, and taking account of the other predictor (Trust Index), the predicted Turnover Rate will go up about 7.2%.
• E)None of the above.

---

Definitions:

Percentage of Sales

A financial metric used to determine the ratio of a particular expense or investment to the total sales generated.

Sales Budgeting Approach

A method for planning and controlling sales activities by estimating probable expenses and revenues over a specific period.

Competitive Parity

A strategy where a company sets its marketing budget or price levels to match those of its competitors.

Objective and Task

A method in advertising budgeting where the objective defines what the business seeks to achieve, and the task involves identifying the cost of activities necessary to accomplish this objective.