Let y = sales at a fast-food outlet (1000s of $), x_1= number of competing outle
ID: 3132168 • Letter: L
Question
Let y = sales at a fast-food outlet (1000s of $), x_1= number of competing outlets within a 1-mile radius, x_2 = population within a 1-mile radius (1000s of people), and x_3 be an indicator variable that equals 1 if the outlet has a drive-up window and 0 otherwise. Suppose that the true regression model is What is the mean value of sales when the number of competing outlets is 4, there are 7000 people within a 1-mile radius, and the outlet has a drive-up window? (Round your answer to one decimal place.) What is the mean value of sales for an outlet without a drive-up window that has three competing outlets and 6000 people within a 1-mile radius? (Round your answer to one decimal place.) It takes $15,200 to build a drive-up. A drive-up will add $15,200 to total sales. There are on average 15.2 fast-food outlets with drive-ups in a 1 mile radius. Approximately 1 in 15.2 fast-food outlets have drive-ups.Explanation / Answer
a)x1=4,x2=7,x3=1
y=8-1.5*4+6.5*7+15.2*1=62.7 thousand dollars
b)x1=3,x2=6,x3=0
y=8-1.5*3+6.5*6+15.2*0=42.5 thousand dollars
c)A driveup would add $15,200 to total sales
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