Kramer Smith owns a dry-cleaning service and is thinking about changing his advertising expenditures for the year ...
Kramer Smith owns a dry-cleaning service and is thinking about changing his advertising expenditures for the year. He hires you as a consultant to determine the relationship between sales, consumer incomes, and advertising by means of multiple regression analysis. Smith has gathered the sales, income, and advertising data for the last year, as shown in Table 1. The Sales and Advertising Data (2009) Table 1 Month Sales (y) Advertising (x1) Consumer Income (x2) January 43,000 10,000 41,000 February 40,500 9,000 43,000 March 41,000 11,000 45,000 April 45,900 12,000 47,000 May 47,000 11,000 49,000 June 51,000 12,000 51,000 July 54,000 13,000 53,000 August 57,000 13,000 55,000 September 56,000 14,000 57,000 October 60,000 15,000 58,000 November 61,000 15,800 59,000 December 63,000 16,700 61,000 Using multiple regression, conduct an analysis of the firm’s sales revenue, consumer incomes, and advertising. Describe how you would explain your results to Smith and what recommendations you would suggest. Summarize your recommendations or advice to Smith concerning the relationship between sales, income, and advertising.
8 years ago
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