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The Following Estimated Regression Equation Has Been Proposed to Predict y^=182x1+7x2+15x3\hat { y } = 18 - 2 x _ { 1 } + 7 x _ { 2 } + 15 x _ { 3 }

Question 113

Essay

The following estimated regression equation has been proposed to predict sales at a fast food outlet.
y^=182x1+7x2+15x3\hat { y } = 18 - 2 x _ { 1 } + 7 x _ { 2 } + 15 x _ { 3 }
where
x1=x _ { 1 } = the number of competitors within 1 mile
x2=x _ { 2 } = the population within 1 mile (in 1000 s)\left. 1000 \mathrm {~s} \right)
x3=1x _ { 3 } = 1 if drive-up windows are present; 0 otherwise
y^=\widehat { y } = estimated sales (( in $1000 s)\$ 1000 \mathrm {~s} )
a.
What is the interpretation of 15 (the coefficient of x3) in the regression equation?
b.
Predict sales for an outlet with 2 competitors, a population of 10,000 within one mile, and one drive-up window (give the answer in dollars).
c.
Predict sales for an outlet with 2 competitors, a population of 10,000 within one mile, and no drive-up window (give the answer in dollars).

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a.
Sales of outlets with dri...

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