1. Exercise 1.1 (Problem Statement)
Problem Statement: A bed company is considering hiring an advertising firm to stimulate business. The management consult a research firm to know how much should they spend on advertising to make a profit of about $1 million dollars in the next month. The research firm collect data on the amount of profit (in thousands of dollars) a bed company earns and the amount of advertisement in (hundreds of dollars) for each of 50 bed companies.
Have you read the problem statement and remember main statistical points about it? If necessary read it again and note important statistical points. If finished, click!
Think about each questions below and think of the answer. Only after that, click to move to another question.

2. Exercise 1.1 (Questions and Answers)
Question number 1 (Q1): What are the variables? After thinking about the answer, click!
Answer to Question number 1 (Ans. 1): amount of profit, amount of advertisement
Q2: What levels of measurement are done to the variables? After thinking about the answer, click!
Ans. 2: ratio
Q3: What is the objective of the study statistically?
Ans. 3: Relationship between two variables
Q4: What methodology shall the research firm use?
Ans. 4: Simple linear regression and correlation analysis
Q5: What is the dependent variable and what is the independent variable?
Ans. 5: Amount of advertisement is the dependent variable and amount of profit is the independent variable