4-2 Scenario Analysis (Cars Sold)

4-2 Scenario Analysis (Cars Sold) - QSO-510 Professor A...

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QSO-510 Professor: A. Duhon 4-2 Scenario Analysis (Cars Sold) A finance manager employed by an automobile dealership believes that the number of cars sold in his local market can be predicted by the interest rate charged for a loan. Interest Rate (%) Number of Cars Sold (100s) 3 10 5 7 6 5 8 2 The finance manager performed a regression analysis of the number of cars sold and interest rates using the sample of data above. Shown below is a portion of the regression output. Regression Statistics Multiple R 0.998868 R 2 0.997738 Coefficient Intercept 14.88462 Interest Rate -1.61538 Are there factors other than interest rate charged for a loan that the finance manager should consider in predicting future car sales? In predicting future car sales, there are other factors besides interest rate that should be considered in predicting future car sales. The current state of the economy should be considered (inflation rate etc.), the price of the car and the average income of prospective buyers among others.
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