The Natural Drink Company Has Developed a Regression Model Relating

question 14

Essay

The Natural Drink Company has developed a regression model relating its sales (y in $10,000s) with four independent variables. The four independent variables are price per unit (PRICE, in dollars), competitor's price (COMPRICE, in dollars), advertising (ADV, in $1,000s) and type of container used (CONTAIN; 1 = Cans and 0 = Bottles). Part of the regression results is shown below. (Assume n = 25)

a.If the manufacturer uses can containers, his price is $1.25, advertising $200,000, and his competitor's price is $1.50, what is your estimate of his sales? Give your answer in dollars.
b.Test to see if there is a significant relationship between sales and unit price. Let  = 0.05.
c.Test to see if there is a significant relationship between sales and advertising. Let  = 0.05.
d.Is the type of container a significant variable? Let  = 0.05.
e.Test to see if there is a significant relationship between sales and competitor's price. Let  = 0.05.

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Definitions:

Biramous Appendages

Appendages with two jointed branches extending from their base. Compare with uniramous appendages.

Arthropods

A large group of invertebrate animals that includes insects, spiders, crustaceans, and others, characterized by segmented bodies, exoskeletons, and jointed limbs.

Crustaceans

A diverse group of arthropods, including crabs, lobsters, and shrimp, typically having a segmented body and an exoskeleton.

Vectors

Entities that carry and transmit genetic information or physical quantities, characterized by magnitude and direction.