The following is part of the results of a regression analysis involving sales (y in millions of dollars), advertising expenditures (x1 in thousands of dollars), and number of salespeople (x2) for a corporation. The regression was performed on a sample of 10 observations.
a.If the company uses $40,000 in advertisement and has 30 salespersons, what are the expected sales? Give your answer in dollars.
b.At = 0.05, test for the significance of the coefficient of advertising.
c.At = 0.05, test for the significance of the coefficient of the number of salespeople.
Definitions:
Demand Curve
A graph representing the relationship between the price of a good and the quantity demanded, with price on the vertical axis and quantity on the horizontal axis.
Loanable Funds
The money available for borrowing in the financial markets, determined by savings and investments.
Savers
Individuals or entities that set aside a portion of current income for future use, often by depositing money in savings accounts or investing in securities.
Inflation Rate
The speed at which the overall price level of goods and services increases, leading to a decrease in purchasing power.
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