Alan Ho, a market analyst for Clear Sound Inc., is analyzing sales of heavy metal CD's.Alan's dependent variable is annual heavy metal CD sales (in $1,000,000's), and his independent variables are teenage population (in 1,000's)and type of sales district (0 = urban, 1 = rural).Regression analysis of the data yielded the following tables: For a rural sales district with 10,000 teenagers, Alan's model predicts annual sales of heavy metal CD sales of ___.
A)$2,100,000
B)$524,507
C)$533,333
D)$729,683
E)$210,000

Question

Alan Ho, a market analyst for Clear Sound Inc., is analyzing sales of heavy metal CD's.Alan's dependent variable is annual heavy metal CD sales (in $1,000,000's), and his independent variables are teenage population (in 1,000's)and type of sales district (0 = urban, 1 = rural).Regression analysis of the data yielded the following tables:  For a rural sales district with 10,000 teenagers, Alan's model predicts annual sales of heavy metal CD sales of ___.
A)$2,100,000 
B)$524,507 
C)$533,333 
D)$729,683 
E)$210,000

Quizplus · Accepted Answer

Using the regression equation in the table for rural sales district with variables plugged in, we get:
Sales = -2.15 + 533.33(10) = $5,333,333 / 10 = $533,333. Thus, the answer is C: $533,333.

Alan Ho, a Market Analyst for Clear Sound Inc