A Local Tire Dealer Wants to Predict the Number of Tires

question 98

Multiple Choice

A local tire dealer wants to predict the number of tires sold each month. The dealer believes that the number of tires sold is a linear function of the amount of money invested in advertising. The dealer randomly selects 6 months of data consisting of tire sales (in thousands of tires) and advertising expenditures (in thousands of dollars) . Based on the data set with 6 observations, the simple linear regression model yielded the following results.
$$\sum x$$ = 24 $$\sum X ^ { 2 }$$ =124 $$\sum Y$$ =42 $$\sum Y ^ { 2 }$$ =338 $$\sum X Y$$ =196
-What is the value of SSE?

• A)24
• B)28
• C)44
• D)16
• E)6

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Definitions:

Regulatory Commissions

Government agencies responsible for enforcing laws and regulations in various industries to protect public interest and ensure fair practices.

Discount Rates

The rate of interest applied to calculate the current value of future cash flows.

Market Proxy

A singular asset or portfolio that represents the characteristics of an entire market segment or the market as a whole.

CAPM

The Capital Asset Pricing Model, which describes the relationship between systematic risk and expected return for assets, particularly stocks, suggesting that investors need to be compensated in two ways: time value of money and risk.