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Q4. Suppose you are considering to open an ice-cream parlour at a location where average number of tourists are 1000 per day. To help you decide whether to open the ice-cream parlour or not, you collect data on daily sales (in thousands of rupees) and average number of tourists (in hundreds of per day) for a random sample of 22 restaurants. You set up model as: \text{Sales}_i = B_1 + B_2 \text{Avgtourist}_i + u_i \sum X_i Y_i = 17170, \sum X_i^2 = 13055, \sum Y/n = 32, \sum X/n = 22.5 Obtain the ordinary least square estimator of the slope coefficient and interpret it. Estimate the average sales for your potential parlour location. Will the value of coefficient of determination change if you want to change the unit of measurement of sales from thousands of rupees to rupees, leaving number of tourists unchanged? Explain your answer.

Uploaded: 2022-08-24T21:23:08-08:00
Duration: 2 min 59 s
Channel: T. L.

          Q4. Suppose you are considering to open an ice-cream parlour at a location where average number of tourists are 1000 per day. To help you decide whether to open the ice-cream parlour or not, you collect data on daily sales (in thousands of rupees) and average number of tourists (in hundreds of per day) for a random sample of 22 restaurants. You set up model as: \text{Sales}_i = B_1 + B_2 \text{Avgtourist}_i + u_i \sum X_i Y_i = 17170, \sum X_i^2 = 13055, \sum Y/n = 32, \sum X/n = 22.5 Obtain the ordinary least square estimator of the slope coefficient and interpret it. Estimate the average sales for your potential parlour location. Will the value of coefficient of determination change if you want to change the unit of measurement of sales from thousands of rupees to rupees, leaving number of tourists unchanged? Explain your answer.

Q4. Suppose you are considering to open an ice-cream parlour at a location where average number of tourists are 1000 per day. To help you decide whether to open the ice-cream parlour or not, you collect data on daily sales (in thousands of rupees) and average number of tourists (in hundreds of per day) for a random sample of 22 restaurants. You set up model as: Salesi = B1 + B2 Avgtouristi + ui ∑Xi Yi = 17170, ∑Xi^2 = 13055, ∑Y/n = 32, ∑X/n = 22.5 Obtain the ordinary least square estimator of the slope coefficient and interpret it. Estimate the average sales for your potential parlour location. Will the value of coefficient of determination change if you want to change the unit of measurement of sales from thousands of rupees to rupees, leaving number of tourists unchanged? Explain your answer.

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