Market researchers were interested in the relationship between the price of bobbleheads and the demand of bobbleheads. Information was collected from a survey and used to obtain the regression equation ŷ = –0.227x + 50.455, where x represents the price of bobbleheads (measured in dollars) and ŷ is the predicted demand of bobbleheads (in units). What is the predicted demand of a bobblehead that has price of $6.00?
Substitute the price, x = 6, into the regression equation: ŷ = −0.227(6) + 50.455. The price term is −1.362, so the predicted demand is 50.455 − 1.362 = 49.093 units. Therefore, the predicted demand is 49.093 units, choice B.
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