The Multiple Regression Model

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The Multiple Regression Model

• Hill et al Chapter 7

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A model of the effects of advertising on revenue.
?2 the change in tr (1000) when p is increased
by one unit (1), and a is held constant
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The assumptions of the model
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The estimators
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Sampling properties
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Interval estimates and significance tests
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Measuring Goodness of Fit
y
x
y
x
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Example Measuring Advertising Effectiveness

• tr revenue (thousand )
• p price ()
• a advertising (thousand )
• conclusions
• demand is elastic
• advertising has a positive effect on sales

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Interval Estimates and tests of significance
tc 2.01
    A 95 interval estimate for ?2 is given by  
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Does advertising break-even?
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Goodness of fit