c. Determine if competitor’s price and advertising is individually significantly

Question

c. Determine if competitor’s price and advertising is individually significantly related to sales. Use = 0.10. 1. Price: The p-value for price is 0.036, which is less than the value of = 0.1. So the price is significantly related to sales. 2. Advertising: The p-value for Advertising is 0.9697, which is greater than the value of = 0.1. So the advertising is not significantly related to sales. d. Based on your answer to part (c), drop any insignificant independent variable(s) and re-estimate the model. What is the new estimated regression equation? (2 marks) e. Interpret the slope coefficient(s) of the model from part (d).

Explanation / Answer

In part c we get by p-value that price is significantly effecting the sales whereas advertising is not related with the sales.

So in data you should drop advertising covariate and run regression using price on sales by that we will get a regression line here.

E) suppose the slope of price is b, then we will define the regression as

The value of price changes one unit then the effect on sales is b times.

Related Questions

Navigate

• Browse (All)
• Browse C
• Subjects

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.