The Sample Regression Line Estimated by OLS

question 21

Multiple Choice

The sample regression line estimated by OLS

• A)has an intercept that is equal to zero.
• B)is the same as the population regression line.
• C)cannot have negative and positive slopes.
• D)is the line that minimizes the sum of squared prediction mistakes.

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Definitions:

Margin Lost

The reduction in potential earnings or profit due to inefficiencies, increased costs, or missed opportunities.

Stockout

A situation where inventory is exhausted, and a product is unavailable for sale or delivery, potentially leading to lost sales and customer dissatisfaction.

Cost of Understocking

The financial loss or missed opportunity cost incurred when inventory levels are too low to meet demand.

Holding Cost

The expenses associated with storing unsold goods or materials, including warehousing, insurance, depreciation, and opportunity costs.