SOLUTION: I have no idea how to solve this for a Simple NOVA can you please help?! (a) Interprete the slope of the fitted regression Sales = 842

SOLUTION: I have no idea how to solve this for a Simple NOVA can you please help?! (a) Interprete the slope of the fitted regression Sales = 842 - 37.5 Price (b) If Price =20, what is t

Question 155440This question is from textbook Applied Statistics in Business and Economics
: I have no idea how to solve this for a Simple NOVA can you please help?!
(a) Interprete the slope of the fitted regression Sales = 842 - 37.5 Price
(b) If Price =20, what is the prediction for Sales?
(c) Would the intercept be meaningful if this regression represents DVD sales
at Blockbuster?
This question is from textbook Applied Statistics in Business and Economics

Answer by stanbon(75887) (Show Source): You can put this solution on YOUR website!
solve this for a Simple NOVA can you please help?!
(a) Interpret the slope of the fitted regression Sales = 842 - 37.5 Price
The independent variable is Price. Its coefficient is the slope.
Since the slope is -37.5 that means Sales decreases 37.5 for $1 increase
in the price.
To see this let price = 0, then let price equal 1. You will see that
Sales goes down $37.50
===========================

(b) If Price =20, what is the prediction for Sales?
Sales (20) = 842 -37.5*20 = $92.00
-------------------------------------------
(c) Would the intercept be meaningful if this regression represents DVD sales
at Blockbuster?
The intercept is Sales(0) = 842
No, it would not be meanful as it says Sales = $842 if price is zero.
======================================
Cheers,
Stan H.

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