A Manager Uses Regression to Express Sales as a Function

question 61

Multiple Choice

A manager uses regression to express sales as a function of advertising expenditures (X1) , and per capita income (X2) in your sales area. The following multiple linear regression equation is developed:
Y = 10 + 0.51X1 + 0.45X2
The coefficient of determination is 0.96
This coefficient of determination explains that:

• A) 96% of sales variations are due to an error term.
• B) The dependent variable is not related to advertising expenditures and per capita income.
• C) 96% of sales variations are explained by the equation.
• D) Only 4% of the sales variations are explained by advertising expenditures and per capita income.

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Definitions:

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