The Following Regression Model Has Been Proposed to Predict Sales

question 38

Essay

The following regression model has been proposed to predict sales at a fast food outlet. = 18 - 2x₁ + 7x₂ + 15x₃
where
x₁ = the number of competitors within 1 mile
x₂ = the population within 1 mile (in 1,000s)
x₃ = 1 if drive-up windows are present, 0 otherwise = sales (in $1,000s)
a.What is the interpretation of 15 (the coefficient of x₃) in the regression equation?
b.Predict sales for a store with 2 competitors, a population of 10,000 within one mile, and one drive-up window (give the answer in dollars).
c.Predict sales for the store with 2 competitors, a population of 10,000 within one mile, and no drive-up window (give the answer in dollars).

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