A regression model is used to forecast sales based on advertising dollars spent. The intercept is $500 and the slope is $35. The R-squared value is 0.90. Which is the best statement about this forecasting model? a. The correlation coefficient between sales and advertising is 0.81.
b. For every $1 spent on advertising, sales are predicted to increase by $500.
c. For every $35 spent on advertising, sales are predicted to increase by $1.
d. Even if no money is spent on advertising, the company realizes $500 of sales.

d. Even if no money is spent on advertising, the company realizes $500 of sales.

Explanation:

In a regression model, the intercept term tells us the value of y when the value of x is zero.

According to this model, the y value here is the forecasted sales. The x value is the advertising dollars spent and the intercept is $500.

This therefore means that when no money is spent on advertising i.e. x = 0, the sales(y) would be $500 which is the intercept term.

the correct answer is economics is a game without winners or losers.

unlike sports or games economic is a game without losers or winner rather it is a game where everyone wins. parties of business doing businesses exchange money with each other and hence exchange is done on the basis of goods. one party takes the goods and other sales it so there is winner on both sides. each party values more highly the good it gets than the good it gives up. both sides exchange only because both intend to increase their value. so there is no concept of lose or win.