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The marketing manager of a large supermarket chain faced the business problem of determining the effect on the sales of pet food of shelf space and whether the product was placed at the front (=1) or back (=0) of the aisle. Data are collected from a random sample of equal-sized stores. The results are shown in the following table (and organized and stored in Petfood):
Store
Shelf Space (Feet)
Location
Weekly Sales (Dolllars)
1
5
0
160
2
220
3
140
4
10
190
240
6
260
7
15
230
8
270
9
280
20
11
290
12
310
Store Shelf Space (Feet) Location Weekly Sales (Dolllars) 1 5 0 160 2 5 0 220 3 5 0 140 4 10 0 190 5 10 0 240 6 10 1 260 7 15 0 230 8 15 0 270 9 15 1 280 10 20 0 260 11 20 0 290 12 20 1 310 For (a) through (m), do not include an interaction term.
A. State the multiple regression equation that predicts sales based on shelf space and location. a. Y=a + b1X1 + b2X2 + b3X3
B. Interpret the regression coefficients in (a).
C. Predict the weekly sales of pet food for a store with 8 feet of shelf space situated at the back of the aisle. Construct a 95% confidence interval estimate and a 95% prediction interval.
D. Perform a residual analysis on the results and determine whether the regression assumptions are valid.
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