Question

A large national bank charges local companies for using their services. A bank official reported the results of a regression analysis designed to predict the bank's charges (Y) —measured in dollars per month—for services rendered to local companies. One independent variable used to predict service charges to a company is the company's sales revenue (X) —measured in millions of dollars. Data for 21 companies who use the bank's services were used to fit the model: Yi = β0 + β1Xi + εi The results of the simple linear regression are provided below. Y = -2,700 + 20X, SYX = 65, two-tail p value = 0.034 (for testing β1) 10) Referring to Scenario 13-1, a 95% confidence interval for β1 is (15, 30). Interpret the interval. A) You are 95% confident that mean service charge (Y) will increase between $15 and $30 for every $1 million increase in sales revenue (X).B) You are 95% confident that the sales revenue (X) will increase between $15 and $30 million for every $1 increase in service charge (Y).C) At the α = 0.05 level, there is no evidence of a linear relationship between service charge (Y) and sales revenue (X).D) You are 95% confident that the mean service charge will fall between $15 and $30 per month. 11) In a multiple regression problem involving two independent variables, if b1 is computed to be +2.0, it means that A) the estimated mean of Y increases by 2 units for each increase of 1 unit of X1, holding X2 constant.B) the estimated mean of Y increases by 2 units for each increase of 1 unit of X1, without regard to X2.C) the estimated mean of Y is 2 when X1 equals zero.D) the relationship between X1 and Y is significant.

          A large national bank charges local companies for using their services. A bank official reported the results of a regression analysis designed to predict the bank's charges (Y) —measured in dollars per month—for services rendered to local companies. One independent variable used to predict service charges to a company is the company's sales revenue (X) —measured in millions of dollars. Data for 21 companies who use the bank's services were used to fit the model: Yi = β0 + β1Xi + εi The results of the simple linear regression are provided below.  Y = -2,700 + 20X, SYX = 65, two-tail p value = 0.034 (for testing β1) 10) Referring to Scenario 13-1, a 95% confidence interval for β1 is (15, 30). Interpret the interval.             A) You are 95% confident that mean service charge (Y) will increase between $15 and $30 for every $1 million increase in sales revenue (X).B) You are 95% confident that the sales revenue (X) will increase between $15 and $30 million for every $1 increase in service charge (Y).C) At the α = 0.05 level, there is no evidence of a linear relationship between service charge (Y) and sales revenue (X).D) You are 95% confident that the mean service charge will fall between $15 and $30 per month. 11) In a multiple regression problem involving two independent variables, if b1 is computed to be +2.0, it means that A) the estimated mean of Y increases by 2 units for each increase of 1 unit of X1, holding X2 constant.B) the estimated mean of Y increases by 2 units for each increase of 1 unit of X1, without regard to X2.C) the estimated mean of Y is 2 when X1 equals zero.D) the relationship between X1 and Y is significant.

Added by Christopher S.

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