Regression analysis was applied between demand for a product Y) and the price of the product X), and the following estimated regression equation was obtained. $\hat { Y }$ = 120 - 10 X
Based on the above estimated regression equation, if price is increased by 2 units, then demand is expected to
A) increase by 120 units
B) increase by 100 units
C) increase by 20 units
D) decease by 20 units

Question

Quizplus · Accepted Answer

The coefficient of X in the regression equation is -10, indicating that for each unit increase in price, demand decreases by 10 units. Therefore, if the price increases by 2 units, demand is expected to decrease by 20 units (2 * -10 = -20).

Regression Analysis Was Applied Between Demand for a Product Y) Y^\hat { Y }Y^

Regression Analysis Was Applied Between Demand for a Product Y) $\hat { Y }$