A store manager wanted to know if there was any relationship of sales dollars to

Question

A store manager wanted to know if there was any relationship of sales dollars to shelf space allocated. In a random sample of 12 different layouts resulting in the following data set.

Store

Shelf Space (feet)

Weekly Sales ($00)

5

1.6

5

2.2

5

1.4

10

1.9

10

2.4

10

2.6

15

2.3

15

2.7

15

2.8

20

2.6

20

2.9

20

3.1

the y intercept value = 1.45

the slope = 0.074

What do you estimate your regression equation to predict the value of y when x = 8?     

Which statement should you make to clarify the calculation of your estimate prediction of the value of y when x = 8?

            A.        The data are interpolated.

            B.        The data are extrapolated.

            C.        The data was calculated using the regression model.

            D.        The data was not determined by using the regression model.

Store

Shelf Space (feet)

Weekly Sales ($00)

1

5

1.6

2

5

2.2

3

5

1.4

4

10

1.9

5

10

2.4

6

10

2.6

7

15

2.3

8

15

2.7

9

15

2.8

10

20

2.6

11

20

2.9

12

20

3.1

Explanation / Answer

The linear regression becomes:

y = 1.45 +.074x

Estimate @ x=8, y = 1.45 +.074*8 = 2.042

The data was calculated using the regression model

The answer is option C

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