Selling price and amount spent advertising were entered into a multiple regression to determine what affects flat panel LCD TV sales. Use the output shown below,
Calculate the amount of variability in Sales is explained by the estimated multiple
Regression model. $$\begin{array}{l}
\text { Analysis of Variance }\
\begin{array} { l r r r }
\text { Source } & \text { DF } & \text { SS } & \text { MS } \
\text { Regression } & 2 & 16477.3 & 8238.7 \
\text { Residual Error } & 27 & 3038.0 & 112.5 \
\text { Total } & 29 & 19515.4 &
\end{array}
\end{array}$$
A) 15.57%
B) 6.90%
C) 84.43%
D) 29%
E) None of the above.

Question

Selling price and amount spent advertising were entered into a multiple regression to determine what affects flat panel LCD TV sales. Use the output shown below,
Calculate the amount of variability in Sales is explained by the estimated multiple
Regression model. $$\begin{array}{l}
\text { Analysis of Variance }\
\begin{array} { l r r r } 
\text { Source } & \text { DF } & \text { SS } & \text { MS } \
\text { Regression } & 2 & 16477.3 & 8238.7 \
\text { Residual Error } & 27 & 3038.0 & 112.5 \
\text { Total } & 29 & 19515.4 &
\end{array}
\end{array}$$
A) 15.57%
B) 6.90%
C) 84.43%
D) 29%
E) None of the above.

Quizplus · Accepted Answer

The amount of variability in sales explained by the model can be found by calculating the R-squared value, which measures the proportion of variance in the dependent variable (sales) that is explained by the independent variables (selling price and amount spent advertising) in the model. This value can be calculated by dividing the SS regression by the total SS, as follows:
R-squared = SS regression / SS Total = 16477.3 / 19515.4 = 0.8443 or 84.43%
Therefore, the answer is C.

Selling Price and Amount Spent Advertising Were Entered into a Multiple