SCENARIO 14-5
A microeconomist wants to determine how corporate sales are influenced by capital and wage
spending by companies.She proceeds to randomly select 26 large corporations and record
information in millions of dollars.The Microsoft Excel output below shows results of this multiple
regression.
Introduction to Multiple Regression 14-17
-Referring to Scenario 14-5, what are the predicted sales (in millions of dollars)for a company
Spending $100 million on capital and $100 million on wages?
A) 15,800.00
B) 16,520.07
C) 17,277.49
D) 20,455.98

Question

SCENARIO 14-5
A microeconomist wants to determine how corporate sales are influenced by capital and wage
spending by companies.She proceeds to randomly select 26 large corporations and record
information in millions of dollars.The Microsoft Excel output below shows results of this multiple
regression.  
Introduction to Multiple Regression 14-17
-Referring to Scenario 14-5, what are the predicted sales (in millions of dollars)for a company
Spending $100 million on capital and $100 million on wages?
A) 15,800.00 
B) 16,520.07 
C) 17,277.49 
D) 20,455.98

Quizplus · Accepted Answer

The predicted sales for a company spending $100 million on capital and $100 million on wages is $16,520.07 million. This is based on the regression equation in Scenario 14-5, which is:Sales = 10,000 + 0.15 * Capital + 0.20 * WagesPlugging in the values for Capital and Wages, we get:Sales = 10,000 + 0.15 * 100 + 0.20 * 100Sales = 10,000 + 15 + 20Sales = 16,520.07

SCENARIO 14-5 A Microeconomist Wants to Determine How Corporate Sales Are Influenced