A Regression Analysis Between Sales (In $1000) and Advertising (In $\hat { y }$

question 72

Multiple Choice

A regression analysis between sales (in $1000) and advertising (in $) yielded the least squares line $\hat { y }$ = 80 000 + 5x. This implies that an:

• A)increase of $1 in advertising is expected to result in an increase of $5 in sales.
• B)increase $5 in advertising is expected to result in an increase of $5000 in sales.
• C)increase of $1 in advertising is expected to result in an increase of $80 005 in sales.
• D)increase of $1 in advertising is expected to result in an increase of $5000 in sales.

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Definitions:

Acceptance Sampling

A statistical quality control method where a random sample of items from a lot is inspected to decide if the whole lot should be accepted or rejected.

Defective Items

Products that fail to meet quality standards or specifications, often resulting in returns or waste.

AOQ

Average Outgoing Quality, a measure in quality control that represents the average quality level of products leaving the manufacturing process.

Type I Error

Statistically, the probability of rejecting a good lot.