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1) According to Model 1, the average increase in sales (in million) per quarter

ID: 2909604 • Letter: 1

Question

1)

According to Model 1, the average increase in sales (in million) per quarter is (Give your answer in million with 2 decimal places.)

2)

In Model 1, test H0:?1=0H0:?1=0, Ha:?1?0Ha:?1?0 at ?=10%.

A)We fail to reject the null hypothesis since the coefficient is negative.

B)We fail to reject the null hypothesis since the P-value is greater than the significance level.

C)We reject the null hypothesis since the P-value is greater than the significance level.

D) We reject the null hypothesis since the test statistic is negative.

3) Based on the P-values of the indicator variables in Models 1, 2, and 3, we conclude at ?=10%?=10% that the ranking of the four quarters in descending order of sales should be:

A)Spring > Summer > Fall > Winter

B)There is no statistically significant difference in sales among the four quarters.

Spring > Summer > Fall = Winter

D)Spring > Summer = Fall = Winter

4) According to Model 3, the sales (in million) for the Spring quarter of 2008 is expected to be (Give your answer in million with 1 decimal place.)

A)We fail to reject the null hypothesis since the coefficient is negative.

B)We fail to reject the null hypothesis since the P-value is greater than the significance level.

C)We reject the null hypothesis since the P-value is greater than the significance level.

D) We reject the null hypothesis since the test statistic is negative.

3) Based on the P-values of the indicator variables in Models 1, 2, and 3, we conclude at ?=10%?=10% that the ranking of the four quarters in descending order of sales should be:

A)Spring > Summer > Fall > Winter

B)There is no statistically significant difference in sales among the four quarters.

C)

Spring > Summer > Fall = Winter

D)Spring > Summer = Fall = Winter

4) According to Model 3, the sales (in million) for the Spring quarter of 2008 is expected to be (Give your answer in million with 1 decimal place.)

Year uatein milli SalsTi D1 02 D3 MODEL 1: Y A+ßPer od +a, D1 +6,D2 +6,D3 2004 WinterS35.452 41.4892 $ 40 9823 S 42777 Regreasion Statiatica Mutiple R 0.9097 R Square 0.827 Adi. R Sq 0.7849 St. Eror 84940 2005 WinteS43.4925 579 S59 4787 inte S63.103 84.45810 Summer 387.99011 S 88 543 12 2007WinterS73 457 Regesi0 Residus 4 3808 97 95224 13.20 0.0004 11 79303 7215 Spig S89. 12414 5 85.892 P.value Interoept 3204 0.37 5.03 0.0004 6.83 0.0000 D1 D2 324047 085 10.21 17-0.14 08930 808 168 0.1212 39 MODEL 2: Y-A + Period + D2 + 6, D3 SUMMARY OUTPUT SUMMARY OUTPUT Multiple R 0.9095 R Square0,8273 dj R Sq 0.7841 St. rra8.1394 Multicle R 0.9071 R Saua 0.8228 Ad R Sq 0.7955 St Error7.921 ANOVA ANOVA Regressio Residual 3 380760 1269 20 9.16 0.0001 12 795 00 6e 25 Regressi Residua 2 378683 1893 42 30.17 0.0000 13 815 7 275 Inter cect Poriod D2 31.48 3.28 10.66 474 0.44 4.99 685 0.0000 738 0.0000 213 0.0542 Intercept 3232 3.27 9.72 4 38 43 759 0.0000 458 212 0.0537 739 0.0000 D2

Explanation / Answer

1) According to Model 1, the average increase in sales (in million) per quarter is (Give your answer in million with 2 decimal places.)

In Winter the average change in sales = 3.24 - 0.85 = 2.4 million

In Spring the average change in sales = 3.24 10.21 = 13.45 million

In Summer the average change in sales = 3.24 10.21 = 5.62 million

In Fall the average change in sales = 3.24 million.

2) In Model 1, test H0:?1=0H0:?1=0, Ha:?1?0Ha:?1?0 at ?=10%.

The p-value corresponding to the variable Period in model 1 is zero.

Decision rule:

1) If p-value < level of significance (alpha) then we reject null hypothesis

2) If p-value > level of significance (alpha) then we fail to reject null hypothesis.

Here p value = 0 < 0.10 so we used first rule.

That is we reject null hypothesis.

So correct choice is "We reject the null hypothesis since the P-value is less than the significance level."

3) Based on the P-values of the indicator variables in Models 1, 2, and 3, we conclude at ?=10%?=10% that the ranking of the four quarters in descending order of sales should be:

The correct option is D) Spring >  Summer = Fall = Winter.

Because the p-value corresponding to the variable Spring that is D2 is less than 0.10 .

4) According to Model 3, the sales (in million) for the Spring quarter of 2008 is expected to be (Give your answer in million with 1 decimal place.)

Expected sales in the quater of Spring = 32.32 + (3.27*18 ) +9.72 = 45.31 = 100.9 million.