Even Though Insignificant Explanatory Variables Can Raise the Adjusted R²

question 22

Multiple Choice

Even though insignificant explanatory variables can raise the adjusted R² of a demand function,one should not interpret their effects on the regression when

• A) testing marketing hypotheses about the determinants of demand
• B) analyzing inventory relative to capacity requirements
• C) forecasting unit sales for operations planning
• D) sales revenue reaches its peak
• E) planning for capital budgets

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Definitions:

Poor Outcomes

Unfavorable results or consequences in any situation, often linked to health, education, or social circumstances.

Resilience

The capacity to recover quickly from difficulties; toughness or the ability to bounce back from stress or adversity.

Bounce Back

The ability to recover quickly from difficulties; resilience.

Adapt

To make suitable adjustments to new conditions or a different environment in order to improve functionality or survival.