A regression analysis between sales (in $1000) and advertising (in $100) resulted in the following least squares line: = 77 +8x. This implies that if advertising is $600, then the predicted amount of sales (in dollars) is $125,000.

Question

A regression analysis between sales (in $1000) and advertising (in $100) resulted in the following least squares line:  = 77 +8x. This implies that if advertising is $600, then the predicted amount of sales (in dollars) is $125,000.

Quizplus · Accepted Answer

Substituting x=6 (since advertising is given to be $600) in the least squares line gives the predicted amount of sales as $125, which in $1000 is $125,000.

A Regression Analysis Between Sales (In $1000) and Advertising (In