A Marketing Analyst Wants to Examine the Relationship Between Sales

Multiple Choice

A marketing analyst wants to examine the relationship between sales (in $1,000s) and advertising (in $100s) for firms in the food and beverage industry and so collects monthly data for 25 firms. He estimates the model: Sales = β₀ + β₁ Advertising + ε. The following table shows a portion of the regression results. Which of the following are the competing hypotheses used to test whether Advertising is significant in predicting Sales?

A) H₀: b₁ = 0; H_A: b₁ ≠ 0.
B) H₀: b₁ = 2.88; H_A: b₁ ≠ 2.88.
C) H₀: β₁ = 0; H_A: β₁ ≠ 0.
D) H₀: β₁ ≠ 0; H_A: β₁ = 0.