A marketing manager conducted a study to determine the relationship between money spent on advertising (X) and company sales (Y). The study consisted of 8 companies and the data is given below and is in units of $1000s (ie. 2.4 = $2400.00) d. What is the resulting residual value when advertising expenditure is $2200.00 (X = 2.2), that is the difference between the actual observed value of y and the predicted value of y when using the fitted regression equation? e. What percentage of the variation in company sales is explained by the regression equation? In other words, what is the variability in Y that is due to advertising? Does a linear association exist between advertising expenditure and company sales? Perform the appropriate hypothesis test using a 5% significance level. i. State the null and alternative hypothesis. H0: _____________________________________ Ha: _____________________________________ ii. Compute the test statistic value. iii. Determine the critical value(s) and draw a picture and label the rejection and acceptance regions. iv. Make statistical decision and state your conclusion in terms of the question of interest
A marketing manager conducted a study to determine the relationship between
money spent on advertising (X) and company sales (Y). The study consisted of 8 companies and the data
is given below and is in units of $1000s (ie. 2.4 = $2400.00)
d. What is the resulting residual value when advertising expenditure is $2200.00 (X
= 2.2), that is the difference between the actual observed value of y and the
predicted value of y when using the fitted regression equation?
e. What percentage of the variation in company sales is explained by the regression
equation? In other words, what is the variability in Y that is due to advertising?
Does a linear association exist between advertising expenditure and company
sales? Perform the appropriate hypothesis test using a 5% significance level.
i. State the null and alternative hypothesis.
H0: _____________________________________
Ha: _____________________________________
ii. Compute the test statistic value.
iii. Determine the critical value(s) and draw a picture and label the rejection and
acceptance regions.
iv. Make statistical decision and state your conclusion in terms of the question of
interest
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