A regression analysis between sales (y in $1000) and advertising (x in dollars) resulted in the following equation = 50,000 + 6x The above equation implies that an
A)increase of $6 in advertising is associated with an increase of $6,000 in sales
B)increase of $1 in advertising is associated with an increase of $6 in sales
C)increase of $1 in advertising is associated with an increase of $56,000 in sales
D)increase of $1 in advertising is associated with an increase of $6,000 in sales

Question

A regression analysis between sales (y in $1000) and advertising (x in dollars) resulted in the following equation  = 50,000 + 6x The above equation implies that an
A)increase of $6 in advertising is associated with an increase of $6,000 in sales 
B)increase of $1 in advertising is associated with an increase of $6 in sales 
C)increase of $1 in advertising is associated with an increase of $56,000 in sales 
D)increase of $1 in advertising is associated with an increase of $6,000 in sales

Quizplus · Accepted Answer

The coefficient of advertising (x) in the equation is 6, which means that for every $1 increase in advertising, sales will increase by $6,000 (not $6).

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