Ask Question, Ask an Expert

+1-415-315-9853

info@mywordsolution.com

Ask Statistics and Probability Expert

Correlation coefficient and scatter plot. 

A CEO of a large pharmaceutical company would like to conclude if he has to be placing more money allotted in the budget next year for television advertising of a new drug marketed for controlling asthma. He wonders whether there is a strong relationship between amount of money spent on television advertising for this new drug called XBC and the number of orders received. The manufacturing process of this drug is very difficult and requires stability so the CEO would prefer to generate a stable number of orders. The cost of advertising is always an important consideration in the phase I roll-out of a new drug. Data that have been collected over the past 20 months point to the amount of money spent of television advertising and the number of orders received.

The use of linear regression is a critical tool for a manager's decision-making ability. Please carefully read the instance below and try to answer the problems in terms of the problem context. The results are as follows:

Month

Advertising Cost (thousands of dollars)

Number of Orders

1

$68.93

4,902,000

2

72.62

3,893,000

3

79.58

5,299,000

4

58.67

4,130,000

5

69.18

4,367,000

6

70.14

5,111,000

7

83.37

3,923,000

8

68.88

4,935,000

9

82.99

5,276,000

10

75.23

4,654,000

11

81.38

4,598,000

12

52.90

2,967,000

13

61.27

3,999,000

14

79.19

4,345,000

15

80.03

4,934,000

16

78.21

4,653,000

17

83.77

5,625,000

18

62.53

3,978,000

19

88.76

4,999,000

20

72.64

5,834,000

Set up a scatter diagram and find out the associated correlation coefficient. Examine how strong you think the relationship is between the amounts of money spent on television advertising and the number of orders received. Please use the Correlation procedures within Excel under Tools > Data Analysis. The Scatter plot can more easily be generated using the Chart procedure.

Interpret the meaning of the slope, b1, in the regression equation.

Predict the monthly advertising cost when the number of orders is 5,100,000.

Compute the coefficient of determination, r2, and interpret its meaning.

Compute the standard error of estimate, and interpret its meaning.

Statistics and Probability, Statistics

  • Category:- Statistics and Probability
  • Reference No.:- M922931

Have any Question? 


Related Questions in Statistics and Probability

A random sample of the price of gasoline from 20gas

A random sample of the price of gasoline from 20gas stations in a region gives the statistics below. Complete parts a) and b) ybar = $3.59, s = $0.24 a) Find a 95% confidence interval for the mean price of regular gasoli ...

The total cholesterol levels of a sample of men aged 35-44

The Total Cholesterol levels of a sample of men aged 35-44 are normally distributed with the mean of 203 milligrams per deciliter and a standard deviation of 37.4 milligrams per deciliter. (a) What percent of men have a ...

A sample of 19 school children was randomly selected and

A sample of 19 school children was randomly selected and their age, height and weight was recorded for each child. The results are given below. The goal is to predict the weight of the child by using the height and age. ...

Connie wants to have an annuity payment of 2000 at the end

Connie wants to have an annuity payment of $2,000 at the END of every three months. How much should she deposit now at 6% interest, compounded quarterly, to yield this payment for 3 years? (Use Table 12-2 in your text) $ ...

Listed below is a list of how long it takes for bands on

Listed below is a list of how long it takes for bands on stage to complete their first song (in seconds). 538 312 327 309 344 313 318 315 325 331 312 314 What is the mean time it takes for bands on stage to complete thei ...

1 under what conditions is the median a more meaningful

1. Under what conditions is the median a more meaningful measure of central tendency than the mean? 2. Why do researchers prefer the standard deviation as a measure of variability over the range?

Focusing on leadership and changeintroductionin this

Focusing on leadership and change Introduction In this assignment, we will focus on you, your relationship to leadership and change in your work context and the management ideas that have influenced those topics. Rather ...

Part -11 the final project is like a very abbreviated mini

Part -1: 1) The final project is like a VERY abbreviated mini research report, where you will be running a combination of descriptive statistics and inferential statistics on a dependent variable and an independent varia ...

Examine the history of american party politics from the

Examine the history of American party politics from the Great Depression through the 1990s. Trace the evolution of the major political parties, their policies, and their constituencies during this period.

Let x have a poisson distribution with parameter lambda

Let X have a Poisson distribution with parameter lambda. Show that E(X)= lambda directly from the definition of expected value. [Hint: The first term in the sum equals 0, and then x can be canceled. Now factor out lambda ...

  • 4,153,160 Questions Asked
  • 13,132 Experts
  • 2,558,936 Questions Answered

Ask Experts for help!!

Looking for Assignment Help?

Start excelling in your Courses, Get help with Assignment

Write us your full requirement for evaluation and you will receive response within 20 minutes turnaround time.

Ask Now Help with Problems, Get a Best Answer

Section onea in an atwood machine suppose two objects of

SECTION ONE (a) In an Atwood Machine, suppose two objects of unequal mass are hung vertically over a frictionless

Part 1you work in hr for a company that operates a factory

Part 1: You work in HR for a company that operates a factory manufacturing fiberglass. There are several hundred empl

Details on advanced accounting paperthis paper is intended

DETAILS ON ADVANCED ACCOUNTING PAPER This paper is intended for students to apply the theoretical knowledge around ac

Create a provider database and related reports and queries

Create a provider database and related reports and queries to capture contact information for potential PC component pro

Describe what you learned about the impact of economic

Describe what you learned about the impact of economic, social, and demographic trends affecting the US labor environmen