Question

# You are thinking about opening up a Starbucks in your area but what...

You are thinking about opening up a Starbucks in your area but what to know if it is a good investment. How much money do Starbucks actually make in a year? You collect data to, to help estimate Annual Net Sales, in thousands, of dollars to know how much money you will be making.

You collect data on 27 stores to help make your decision.

x1 = Rent in Thousand per month

x2 = Amount spent on Inventory in Thousand per month

x3 = Amount spent on Advertising in Thousand per month

x4 = Sales in Thousand per month

x5= How many Competitors stores are in the Area

Is there a significant linear relationship between these 5 variables and the Annual Net Sales of a Starbucks?

If so, what is/are the significant predictor(s) for determining the Annual Net Sales of a Starbucks?

See Attached Excel for Data.

Starbuck Sales data.xlsx    9 KB

•  A. Yes,
• Rent, p-value = 0.012388536 < .05, Yes, Rent is a significant predictor for Annual Net Sales
• Advertising, p-value = 0.003599968 < .05, Yes, Advertising is a significant predictor for Annual Net Sales
• Sales per Month, p-value = 0.000876481 < .05, Yes, Sales per Month, is a significant predictor for Annual Net Sales
•  B. No,
• Inventory, p-value = 0.068486021 > .05, No, Inventory is not a significant predictor for Annual Net Sales
• # Competitor Store, p-value = 0.258240292 > .05, No, # Competitor Stores, is not a significant predictor for Annual Net Sales.
•  C. No,
• Rent, p-value = 0.012388536 < .05, Yes, Rent is a significant predictor for Annual Net Sales
• Advertising, p-value = 0.003599968 < .05, Yes, Advertising is a significant predictor for Annual Net Sales
• Sales per Month, p-value = 0.000876481 < .05, Yes, Sales per Month, is a significant predictor for Annual Net Sales
•  D. Yes,
• Inventory, p-value = 0.068486021 > .05, No, Inventory is not a significant predictor for Annual Net Sales
• # Competitor Store, p-value = 0.258240292 > .05, No, # Competitor Stores, is not a significant predictor for Annual Net Sales.

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