Instruction 12-11
a Computer Software Developer Would Like to Use

question 83

Multiple Choice

Instruction 12-11
A computer software developer would like to use the number of downloads (in thousands) for the trial version of his new shareware to predict the amount of revenue (in thousands of dollars) he can make on the full version of the new shareware.Following is the output from a simple linear regression along with the residual plot and normal probability plot obtained from a data set of 30 different sharewares that he has developed:
$\begin{array}{lr}\hline {\text { Regression Statistics }} \\\hline \text { Multiple R } & 0.8691 \\\hline \text { R Square } & 0.7554 \\\hline \text { Adjusted R Square } & 0.7467 \\\text { Standard Error } & 44.4765 \\\text { Observations } & 30.0000 \\\hline\end{array}$
ANOVA
$\begin{array}{lr|r|r|r|r}\hline & d f & {\text { SS }} &{\text { MS }} & F & \text { Significance } F \\\hline \text { Regression } & 1 & 171062.9193 & 171062.9193 & 86.4759 & 0.0000 \\\hline \text { Residual } & 28 & 55388.4309 & 1978.1582 & & \\\hline \text { Total } & 29 & 226451.3503 & & & \\\hline\end{array}$

$\begin{array}{lrrrrrrr}\hline & \text { Coefficients } & \text { Standard Emor } & t \text { Stat } & \text { P-value } & \text { Lower 95\% } & \text { Upper 95\% } \\\hline \text { Intercept } & -95.0614 & 26.9183 & -3.5315 & 0.0015 & -150.2009 & -39.9218 \\\text { Download } & 3.7297 & 0.4011 & 9.2992 & 0.0000 & 2.9082 & 4.5513 \\\hline\end{array}$
-Referring to Instruction 12-11,which of the following is the correct interpretation for the coefficient of determination?

• A)74.67% of the variation in revenue can be explained by the variation in the number of downloads.
• B)75.54% of the variation in revenue can be explained by the variation in the number of downloads.
• C)75.54% of the variation in the number of downloads can be explained by the variation in revenue.
• D)74.67% of the variation in the number of downloads can be explained by the variation in revenue.

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Definitions:

Standard Form

A way of writing down very large or very small numbers conveniently, also specifically referring to the general representation of a linear equation as Ax + By = C.

Multiply

A mathematical operation that combines two quantities to produce a product.

Standard Form

A way of writing numbers, especially large numbers, by expressing them as a power of ten, or, in algebra, a way of writing equations.

Multiply

The operation of adding a number to itself a certain number of times, equivalent to repeated addition.