Regression analysis was applied between sales (in $1000s) and advertising (in $100s), and the following regression function was obtained. ? $\hat { y }$ = 80 + 6.2x
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Based on the above estimated regression line, if advertising is $10,000, then the point estimate for sales (in dollars) is _____.
A) $62,080
B) $142,000
C) $700
D) $700,000

Question

Quizplus · Accepted Answer

The regression equation is $\hat{y} = 80 + 6.2x$. Here, x is in $100s, so $10,000 in advertising is 10000/100 = 100. Plugging x = 100 into the equation gives $\hat{y} = 80 + 6.2(100) = 700$. Since sales are in $1000s, the point estimate for sales is $700,000.

Regression Analysis Was Applied Between Sales (In $1000s) and Advertising y^\hat { y }y^​

Regression Analysis Was Applied Between Sales (In $1000s) and Advertising $\hat { y }$