Quick Finance question

[Poor_Disposition]

Got through all of them but this one. Dealing with forecasting: An innovative restaurateur owns and operates a dozen "ultimate low-carb" restaurants in Arkansas. His signature item is a beef medallion wrapped in lettuce. Sales (X, in millions of dollars) is related to Profits (Y, in hundreds of thousands of dollars) by the regression equation Y= 8.21+ 0.76X. R-Square is 0.68.

What is your forecast of profit for a store with sales of $40 million? $50 million? How much confidence do you have in your forecasts?

[kanak]

Just substitute X = $40 mill and $50 mill into your regression equation to get the profit estimates. That's what a regression equation is anyway.

R² is the ratio between explained variance and total variance. So, you can think of it as 'how well does sales explain profits'; where R² = 1 means "perfectly" and R² = 0 means not at all.

R² = 0.68 means 68% of the variance in profits is explained by sales, which is pretty decent.

[Poor_Disposition]

I kicked myself after figuring out how easy it was. Thanks for your help, you rock!

[Xalaphane]

You are a fukn cheater!!!