Question

Income +0.5 Need a. Specify the dependent and independent variables. b. What will be the demand when income is 0 and need isl tribution cusl regardless of the an 24 months (stored tion costs (in $tho ber of orders rece a. State the mult b. Interpret the APPLYING THE CONCEPTS 14.3 A shoe manufacturer is considering developing a new b brand of running shoes. The business problem facing the marketing analyst is to determine which variables should be used to predict durability G.e, the effect of long-term impact). Two independent variables un- c. Explain wh der consideration are X, (FOREIMP), a ameasurement of the forefoot shock-absorbing capability, and X2 (MIDSOLE), a measurement of the change in impact properties over time. The dependent variable ) is LTIMP a measure of the shoe's durability after a repeated impact test. Data are collected from a random sample of 15 types of cur- meaning in sales are $ monthly d. Predict the e. Construct rently manufactured running shoes, with the following results: and the rn Standard Variable Coefficients Error t Statistic p-Value Intercept 0.02686 0.06905-0.39 0.7034 0.0000 8.43 0.0000 FOREIMP MIDSOLE 0.60484 0.07174 0.79116 0,06295 12.57

Answer 1

Answer a)

Multiple Regression Equation is as follows:

LTIMP = -0.02686 + 0.79116*FOREIMP + 0.60484*MIDSOLE

Answer b)

Interpretation of Slopes

b1 = Slope of FOREIMP = 0.79116

Keeping other variables constant, 1 unit increase in FOREIMP, increases LTIMP by 0.79116 units

b1 = Slope of MIDSOLE = 0.60484

Keeping other variables constant, 1 unit increase in MIDSOLE, increases LTIMP by 0.60484 units

Answer c)

The p-value of variable FOREIMP is less than 0.01. This shows that FOREIMP is a significant predictor of LTIMP at 0.01 level of significance

The p-value of variable MIDSOLE is less than 0.01. This shows that MIDSOLE is a significant predictor of LTIMP at 0.01 level of significance