Suzie's Bagels is a breakfast deli located on a university campus. Suzie wants to use regression analysis to estimate the demand for her bagel sandwiches. Suzie has collected daily data on the quantity of bagel sandwiches sold over the last year. In order to correctly specify the regression, all of the following variables should be considered except which one?
A)the prices of Suzie's bagel sandwiches
B)the amount of advertising spent by Suzie's competitors
C)the cost of university housing
D)the amount Suzie spent on advertising

Question

Quizplus · Accepted Answer

The cost of university housing is not relevant to the demand for Suzie's bagel sandwiches, and is therefore not a variable that should be considered when specifying the regression. The other variables listed (price of bagel sandwiches, competitors' advertising spending, and Suzie's own advertising spending) are all factors that could potentially impact the demand for her bagel sandwiches and should be included in the regression analysis.

Suzie's Bagels Is a Breakfast Deli Located on a University