TABLE 13-1 A Large National Bank Charges Local Companies for Using Their

question 198

Multiple Choice

TABLE 13-1
A large national bank charges local companies for using their services. A bank official reported the results of a regression analysis designed to predict the bank's charges (Y) measured in dollars per monthfor services rendered to local companies. One independent variable used to predict service charges to a company is the company's sales revenue (X) measured in millions of dollars. Data for 21 companies who use the bank's services were used to fit the model:
Yᵢ = β₀ + β₁Xi + Eᵢ
The results of the simple linear regression are provided below.

-Referring to Table 13-1, a 95% confidence interval for β₁ is (15, 30) . Interpret the interval.

• A) You are 95% confident that the mean service charge will fall between $15 and $30 per month.
• B) You are 95% confident that the sales revenue (
• X) will increase between $15 and $30 million for every $1 increase in service charge (
• Y).
• C) You are 95% confident that mean service charge (
• Y) will increase between $15 and $30 for every $1 million increase in sales revenue (
• X).
• D) At the α = 0.05 level, there is no evidence of a linear relationship between service charge (
• Y) and sales revenue (

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Definitions:

Strategic Objective

A specific goal that an organization aims to achieve as part of its broader strategy to fulfill its mission and vision.

Loyal Customers

Individuals who repeatedly purchase products or services from the same brand or company, often due to positive experiences or satisfaction.

Restructuring

The act of organizing something, such as a company or system, differently in order to make it operate more effectively.

Turnaround

The process of implementing significant changes in a company to address financial or operational issues and improve performance and profitability.