Stores that experience extremely low sales in one sales period will typically perform better in the next sales period due to:
A)regression to the mean
B)expected utility theory
C)contrast effect
D)simulation effect
E)perseverance effect

Question

Quizplus · Accepted Answer

Regression to the mean refers to the statistical phenomenon where extreme values tend to move closer to the average in subsequent measurements. In the context of store sales, this means that stores that experience extremely low sales in one sales period will, on average, perform closer to their historical sales in the next sales period. This effect is likely due to various factors that contribute to the performance of a store, such as changes in marketing strategies, consumer behavior, and external factors. Therefore, stores that experience low sales in one period are more likely to improve their sales in the next period, leading to a regression to the mean.

Stores That Experience Extremely Low Sales in One Sales Period