1. The owner of the Original Italian Pizzeria restaurant chainwould like to predict the sales of her specialty deep-dish pizza.She has gathered data on the monthly sales of deep-dish pizzas ather restaurants and observations on other potentially relevantvariables for each of her 15 restaurants in Northern California.The data is found in the file “DeepDishPizza.â€
a. Create two (2) scatter charts. The first one will be ascatter chart of Quantity Sold (on the y-axis) and the variableDisposable Income per Household (on the x-axis). The second onewill be a scatter chart of Quantity Sold (on the y-axis) and thevariable Monthly Advertising Expenditures. Be sure to label theaxes correctly.
b. Using the Regression function in Data Analysis, estimate aregression equation between Quantity Sold and Disposable Income perHousehold. Type your estimated equation in a text box. How wouldyou explain the interpretation of the coefficient on DisposableIncome per Household and the R 2 to the owner?
c. At a level of significance of 5%, test the null hypothesisthat the coefficient on Disposable Income per Household is 0.Clearly explain your answer.
d. The owner also wants to know whether advertising expenses byher firm have any effect on the number of deep-dish pizzas sold.Using the Regression function in Data Analysis, estimate aregression equation between Quantity Sold and Disposable Income perHousehold Type and Monthly Advertising Expenditure. Type yourestimated equation in a text box. How would you now explain bothestimated coefficients and the R 2 to the owner?
e. At a level of significance of 5%, test the null hypothesisthat the coefficient on each independent variable is 0. Clearlyexplain your answer.
f. For the equation you estimated in (d), what is theinterpretation of the F-test? Is it significant at a level ofsignificance of 5%?
g. Suppose the Disposable Income per Household is equal to$43,000. Using your estimated regression equation in (d), whatshould the owner plan on Monthly Advertising Expenditures perrestaurant if she wants to sell 58,000 deep-dish pizza perrestaurant? Show your work.
| Restaurant Number | Quantity Sold | Disposable Income per Household | Monthly Advertising Expenditures |
| 1 | 85,300 | $42,100 | $64,800 |
| 2 | 40,500 | $38,300 | $42,800 |
| 3 | 61,800 | $41,000 | $58,600 |
| 4 | 50,800 | $43,300 | $46,500 |
| 5 | 60,600 | $44,000 | $50,700 |
| 6 | 79,400 | $41,200 | $60,100 |
| 7 | 71,400 | $41,700 | $55,600 |
| 8 | 70,700 | $43,600 | $57,900 |
| 9 | 55,600 | $39,900 | $52,100 |
| 10 | 70,900 | $44,800 | $60,700 |
| 11 | 77,200 | $41,800 | $64,400 |
| 12 | 63,200 | $44,200 | $55,600 |
| 13 | 71,100 | $40,100 | $60,900 |
| 14 | 55,500 | $39,100 | $47,200 |
| 15 | 42,100 | $38,000 | $46,100 |
