Selling price and amount spent advertising were entered into a multiple regression to determine what affects flat panel LCD TV sales. The adjusted $\mathrm { R } ^ { 2 }$ value was reported as $83.3 \%$. This means that
A) Selling price and amount spent advertising do not describe TV sales well.
B) $83.3 \%$ of the variance in TV sales can be accounted for by selling price.
C) $83.3 \%$ of the variance in TV sales can be accounted for by amount spent advertising.
D) $83.3 \%$ of the variance in TV sales can be accounted for by the model including both selling price and amount spent advertising.
E) Both selling price and amount spent advertising are significant predictors of TV sales.

Question

Quizplus · Accepted Answer

The adjusted $R^2$ value of $83.3\%$ indicates that $83.3\%$ of the variance in TV sales can be explained by the regression model, which includes both selling price and amount spent on advertising. This does not necessarily mean each predictor is significant individually (without further statistical tests), but together, they account for a large portion of the variance in sales.

Selling Price and Amount Spent Advertising Were Entered into a Multiple