Answer to Question #96726 in Statistics and Probability for Adekunle Okunade

Question

ASSIGNMENT ON STATISTICS
As a marketing analyst for Mutual life Assurance Plc. You gather the following data on advertising and sales

Advertising ($)’00 Sales (Units)’000
1 1
2 1
3 2
4 2
5 4
i. Find the least square lines relating sales and advertising
ii. Interpret your answer in (i) above.

Answer 1

The Excel regression analysis was used to obtain the above answer:

i) The regression equation

From the above regression output the model equation is given as:

Sales = -100 +7 Advertising ($)

ii) Interpretation;

The model indicates that the amount sold (sales) increases by 7 units for every dollar spent on advertising.