The Manager of a Gas Station Along an Interstate Highway

question 93

Essay

The manager of a gas station along an interstate highway has observed that gasoline sales generally increase each week over the summer months as more families travel by car on vacations. He also believes that sales are sensitive to fluctuations in the price of gasoline. He developed the following regression model:
Sales = 59407 + 509 (Week) + 16463 (Price/gallon)
a.Interpret the coefficients of the independent variables in this model.
b.What is the sales forecast for the 12^th week of the summer if the price per gallon is estimated to be $3.00?

---

Definitions:

Ranks Of Data

The order of data points based on their value, usually from smallest to largest, used in non-parametric statistical analyses.

Pearson's Correlation

A measure of the linear correlation between two variables, ranging from -1 to +1.

Ranks Of Data

The ordering of data points based on their size or magnitude, usually from the smallest to the largest.

Nonparametric Counterpart

A statistical method or test that does not assume a specific distribution for the data, suitable for ordinal or nominal data.