A regression analysis between sales (Y in $1000)and advertising (X in dollars)resulted in the following equation

= 30,000 + 4 X
The above equation implies that an
A)increase of $4 in advertising is associated with an increase of $4,000 in sales
B)increase of $1 in advertising is associated with an increase of $4 in sales
C)increase of $1 in advertising is associated with an increase of $34,000 in sales
D)increase of $1 in advertising is associated with an increase of $4,000 in sales

Question

A regression analysis between sales (Y in $1000)and advertising (X in dollars)resulted in the following equation

= 30,000 + 4 X
The above equation implies that an
A)increase of $4 in advertising is associated with an increase of $4,000 in sales 
B)increase of $1 in advertising is associated with an increase of $4 in sales 
C)increase of $1 in advertising is associated with an increase of $34,000 in sales 
D)increase of $1 in advertising is associated with an increase of $4,000 in sales

Quizplus · Accepted Answer

The coefficient of X in the equation is 4, which means that for each unit increase in X (advertising), Y (sales) is expected to increase by 4 units (in thousands). Therefore, an increase of $1 in advertising is associated with an increase of $4,000 in sales.

A Regression Analysis Between Sales (Y in $1000)and Advertising (X