All Greens is a franchise store that sells house plants and lawn and garden supplies. Although All Greens is a franchise, each store is owned and managed by private individuals. Some friends have asked you to go into business with them to open a new All Greens store in the suburbs of San Diego. The national franchise headquarters sent you the following information at your request. These data are about 27 All Greens stores in California. Each of the 27 stores has been doing very well, and you would like to use the information to help set up your own new store. The variables for which we have data are detailed below. x1 = annual net sales, in thousands of dollars x2 = number of square feet of floor display in store, in thousands of square feet x3 = value of store inventory, in thousands of dollars x4 = amount spent on local advertising, in thousands of dollars x5 = size of sales district, in thousands of families x6 = number of competing or similar stores in sales district A sales district was defined to be the region within a 5 mile radius of an All Greens store. x1 x2 x3 x4 x5 x6 231 3 294 8.2 8.2 11 156 2.2 232 6.9 4.1 12 10 0.5 149 3 4.3 15 519 5.5 600 12 16.1 1 437 4.4 567 10.6 14.1 5 487 4.8 571 11.8 12.7 4 299 3.1 512 8.1 10.1 10 195 2.5 347 7.7 8.4 12 20 1.2 212 3.3 2.1 15 68 0.6 102 4.9 4.7 8 570 5.4 788 17.4 12.3 1 428 4.2 577 10.5 14.0 7 464 4.7 535 11.3 15.0 3 15 0.6 163 2.5 2.5 14 65 1.2 168 4.7 3.3 11 98 1.6 151 4.6 2.7 10 398 4.3 342 5.5 16.0 4 161 2.6 196 7.2 6.3 13 397 3.8 453 10.4 13.9 7 497 5.3 518 11.5 16.3 1 528 5.6 615 12.3 16.0 0 99 0.8 278 2.8 6.5 14 0.5 1.1 142 3.1 1.6 12 347 3.6 461 9.6 11.3 6 341 3.5 382 9.8 11.5 5 507 5.1 590 12.0 15.7 0 400 8.6 517 7.0 12.0 8 a) Suppose an All Greens store in Sonoma, California, wants to estimate a range of advertising costs appropriate to its store. If it spends too little on advertising, it will not reach enough customers. However, it does not want to overspend on advertising for this type and size of store. At this store, x1 = 163, x2 = 2.4, x3 = 188, x5 = 6.6, and x6 = 10. Use these data to predict x4 (advertising costs) and find an 80% confidence interval for your prediction. (Use 2 decimal places.) prediction lower limit upper limit b) At the 80% confidence level, what range of advertising costs do you think is appropriate for this store? (Round to nearest integer.) lower limit $ upper limit $

All Greens is a franchise store that sells house plants and lawn and garden supplies. Although All Greens is a franchise, each store is owned and managed by private individuals. Some friends have asked you to go into business with them to open a new All Greens store in the suburbs of San Diego. The national franchise headquarters sent you the following information at your request. These data are about 27 All Greens stores in California. Each of the 27 stores has been doing very well, and you would like to use the information to help set up your own new store. The variables for which we have data are detailed below. x1 = annual net sales, in thousands of dollars x2 = number of square feet of floor display in store, in thousands of square feet x3 = value of store inventory, in thousands of dollars x4 = amount spent on local advertising, in thousands of dollars x5 = size of sales district, in thousands of families x6 = number of competing or similar stores in sales district A sales district was defined to be the region within a 5 mile radius of an All Greens store. x1 x2 x3 x4 x5 x6 231 3 294 8.2 8.2 11 156 2.2 232 6.9 4.1 12 10 0.5 149 3 4.3 15 519 5.5 600 12 16.1 1 437 4.4 567 10.6 14.1 5 487 4.8 571 11.8 12.7 4 299 3.1 512 8.1 10.1 10 195 2.5 347 7.7 8.4 12 20 1.2 212 3.3 2.1 15 68 0.6 102 4.9 4.7 8 570 5.4 788 17.4 12.3 1 428 4.2 577 10.5 14.0 7 464 4.7 535 11.3 15.0 3 15 0.6 163 2.5 2.5 14 65 1.2 168 4.7 3.3 11 98 1.6 151 4.6 2.7 10 398 4.3 342 5.5 16.0 4 161 2.6 196 7.2 6.3 13 397 3.8 453 10.4 13.9 7 497 5.3 518 11.5 16.3 1 528 5.6 615 12.3 16.0 0 99 0.8 278 2.8 6.5 14 0.5 1.1 142 3.1 1.6 12 347 3.6 461 9.6 11.3 6 341 3.5 382 9.8 11.5 5 507 5.1 590 12.0 15.7 0 400 8.6 517 7.0 12.0 8 a) Suppose an All Greens store in Sonoma, California, wants to estimate a range of advertising costs appropriate to its store. If it spends too little on advertising, it will not reach enough customers. However, it does not want to overspend on advertising for this type and size of store. At this store, x1 = 163, x2 = 2.4, x3 = 188, x5 = 6.6, and x6 = 10. Use these data to predict x4 (advertising costs) and find an 80% confidence interval for your prediction. (Use 2 decimal places.) prediction lower limit upper limit b) At the 80% confidence level, what range of advertising costs do you think is appropriate for this store? (Round to nearest integer.) lower limit $ upper limit $

Practical Management Science

6th Edition

ISBN:9781337406659

Author:WINSTON, Wayne L.

Publisher:WINSTON, Wayne L.

Chapter2: Introduction To Spreadsheet Modeling

Section: Chapter Questions

Problem 20P: Julie James is opening a lemonade stand. She believes the fixed cost per week of running the stand...

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Question

x₁ = annual net sales, in thousands of dollars
x₂ = number of square feet of floor display in store, in thousands of square feet
x₃ = value of store inventory, in thousands of dollars
x₄ = amount spent on local advertising, in thousands of dollars
x₅ = size of sales district, in thousands of families
x₆ = number of competing or similar stores in sales district

A sales district was defined to be the region within a 5 mile radius of an All Greens store.

x₁	x₂	x₃	x₄	x₅	x₆
231	3	294	8.2	8.2	11
156	2.2	232	6.9	4.1	12
10	0.5	149	3	4.3	15
519	5.5	600	12	16.1	1
437	4.4	567	10.6	14.1	5
487	4.8	571	11.8	12.7	4
299	3.1	512	8.1	10.1	10
195	2.5	347	7.7	8.4	12
20	1.2	212	3.3	2.1	15
68	0.6	102	4.9	4.7	8
570	5.4	788	17.4	12.3	1
428	4.2	577	10.5	14.0	7
464	4.7	535	11.3	15.0	3
15	0.6	163	2.5	2.5	14
65	1.2	168	4.7	3.3	11
98	1.6	151	4.6	2.7	10
398	4.3	342	5.5	16.0	4
161	2.6	196	7.2	6.3	13
397	3.8	453	10.4	13.9	7
497	5.3	518	11.5	16.3	1
528	5.6	615	12.3	16.0	0
99	0.8	278	2.8	6.5	14
0.5	1.1	142	3.1	1.6	12
347	3.6	461	9.6	11.3	6
341	3.5	382	9.8	11.5	5
507	5.1	590	12.0	15.7	0
400	8.6	517	7.0	12.0	8

a) Suppose an All Greens store in Sonoma, California, wants to estimate a range of advertising costs appropriate to its store. If it spends too little on advertising, it will not reach enough customers. However, it does not want to overspend on advertising for this type and size of store. At this store, x₁ = 163, x₂ = 2.4, x₃ = 188, x₅ = 6.6, and x₆ = 10. Use these data to predict x₄ (advertising costs) and find an 80% confidence interval for your prediction. (Use 2 decimal places.)

prediction
lower limit
upper limit

b) At the 80% confidence level, what range of advertising costs do you think is appropriate for this store? (Round to nearest integer.)

lower limit	$
upper limit	$

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