A Researcher Analyzes the Factors That May Influence Amusement Park

question 24

Multiple Choice

A researcher analyzes the factors that may influence amusement park attendance and estimates the following model: Attendance = β₀ + β₁Price + β₂Rides + ε, where Attendance is the daily attendance (in 1,000s) , Price is the gate price (in $) , and Rides is the number of rides at the amusement park. The researcher would like to construct interval estimates for Attendance when Price and Rides equal $85 and 30, respectively. The researcher estimates a modified model where Attendance is the response variable and the explanatory variables are now defined as
Price* = Price - 85 and Rides* = Rides - 30. A portion of the regression results is shown in the accompanying table. According to the modified model, which of the following is a 95% confidence interval for expected Attendance when Price and Rides equal $85 and 30, respectively? (Note that t_0,025,27 = 2.052.)

• A) [12,740, 56,780]
• B) [16,330, 53,450]
• C) [26,080, 42,740]
• D) [28,900, 41,500]

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Definitions:

Post-purchase Stress

The anxiety or concern felt by consumers after making a purchase, typically due to doubts about the decision or the product's performance.

Purchase Remorse

A feeling of regret or doubt experienced by a consumer after making a purchase decision.

Build-Up Method

A method used in finance to estimate the required rate of return on an investment, starting with a risk-free rate and adding risk premiums.

Market Potential

The estimated maximum total sales revenue of all suppliers in a specific market for a certain time period.