1. You need data on the financial behavior (banking, loans, etc.) of mid-Americans to solve a particular problem your firm is experiencing. You design a questionnaire that you pretest at a local bank officers' club meeting. You adjust the questionnaire and send it to a stratified sample of mid-Americans in a large Midwestern city. Your strata (see Chapter 8 or assume sub-samples) are defined geographically and consist of three areas. These are inner city, close outskirts, and suburbs.;What possible things could go wrong?;2. Snack Foods International, Ltd. has hired you to analyze demand in 25 regional markets for a new Product Y, called Angelica Pickles. A statistical analysis of demand in these markets shows (t-statistics in parentheses);Q Y = 250 - 10P + 6P X + 0.25A + 0.04I;(3.33) (3) (2.5) (1.26);R 2 = 91%;Standard Error of the Estimate = 75;Here, Q Y is market demand for Product Y, P is the price of Y in dollars, A is dollars of advertising expenditures, P X is the average price in dollars of another (unidentified) product, and I is dollars of household income. In a typical market, the price of Y is $1,500, P X is $500, advertising expenditures are $50,000, and disposable income per household is $45,000.;A. Calculate the expected level of demand in a typical market.;B. Define R 2 and interpret R 2 for this equation;C. Briefly discuss the individual variable significance.
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