A regression analysis between sales Y in 1000 and advertisin

A regression analysis between sales (Y in $1000) and advertising (X in dollars) resulted in the following equation

= 30,000 + 4 X

The above equation implies that an

increase of $4 in advertising is associated with an increase of $4,000 in sales

increase of $1 in advertising is associated with an increase of $4 in sales

increase of $1 in advertising is associated with an increase of $34,000 in sales

increase of $1 in advertising is associated with an increase of $4,000 in sales

Solution

Interpretation: The regression equation is 30,000+4X indicates that the increase of $1 in advertising is associated with an increase of $4,000 in sales. The fourth choice is correct in this case.