A Random Sample of Records of Electricity Usage of Homes

question 1

Multiple Choice

A random sample of records of electricity usage of homes gives the amount of electricity used in July and size (in square feet) of 135 homes.A regression to predict the amount of electricity used (in kilowatt-hours) from size was completed.The residuals plot indicated that a linear model is appropriate.What are the variables and units in this regression?

• A)Amount of electricity used (in kilowatt-hours)is y and size (in square feet)is x.
• B)Amount of electricity used (in kilowatt-hours)is y and number of homes is x.
• C)Size (in square feet)is y and amount of electricity used (in kilowatt-hours)is x.
• D)Size (in square feet)is y and number of homes is x.
• E)Number of homes is y and amount of electricity used (in kilowatt-hours)is x.

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Definitions:

Total Costs

An alternate formulation for the sum of all expenses incurred in the production of goods or services, reflecting both fixed and variable components.

Profit

The financial gain obtained when the revenue from business activities exceeds the costs and expenses associated with operating the business.

Economic Profit

The total revenue from operations minus both the explicit and implicit costs; it's a measure of profitability factoring opportunity costs.

Accounting Profit

The net income a company reports on its financial statements, calculated as total revenues minus explicit costs of doing business.