Suppose We Wish to Predict the Profits (In Hundreds of Thousands

question 31

Multiple Choice

Suppose we wish to predict the profits (in hundreds of thousands of dollars) for companies that had sales (in hundreds of thousands of dollars) of 500 units. We use statistical software to do the prediction and obtain the following output. A random sample of 19 companies from the Forbes 500 list was selected, and the relationship between sales (in hundreds of thousands of dollars) and profits (in hundreds of thousands of dollars) was investigated by regression. The following simple linear regression model was used: profits =  +  (sales) , where the deviations were assumed to be independent and Normally distributed, with mean 0 and standard deviation . This model was fit to the data using the method of least squares. The following results were obtained from statistical software. r² = 0.662
S = 466.2 A 95% interval for this prediction is:

• A)-1066.4 to 805.6.
• B)-248.5 to -12.3.
• C)-189.7 to -71.1.
• D)400.7 to 559.3.

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Definitions:

Conformity

The act of aligning one's attitudes, beliefs, or behaviors to group norms or expectations.

Minority Of One

A situation where a single individual's opinion, behavior, or belief stands in opposition to that of the larger group.

Ally

A person, group, or nation that is united with another or others for some common purpose or benefit.

Majority Opinion

The judicial opinion agreed to by more than half of the members of a court that sets forth the decision reached in a case.