7.3 management proposed the following regression model to predict sales at a fast-food outlet: yi 5 b0 1 b1x1,i 1 b2x2,i 1 b3x3,i 1ei where y i 5 sales ($1000s) x 1, i 5 number of competitors within one mile x 2, i 5 population within one mile (1000s) x 3, i 5 1 if a drive up window is present and 0 otherwise the following estimated regression equation was developed after 20 outlets were surveyed: y^i 5 10.1 2 4.2x1,i 1 6.8x2,i 1 15.3x3,i a. what is the expected amount of sales attributable to the drive-up window? b. predict sales for a store with two competitors, a population of 8,000 within one mile, and no drive-up window. c. predict sales for a store with one competitor, a population of 3,000 within one mile, and a drive-up window.

Your aunt is thinking about opening a hardware store. she estimates that it would cost $300,000 per year to rent the location and buy the stock. in addition, she would have to quit her $45,000 per year job as an accountant. a. define opportunity cost. b. what is your aunt's opportunity cost of running a hardware store for a year? if your aunt thought she could sell $350,000 worth of merchandise in a year, should she open the store? explain.

Steele bicycle manufacturing company currently produces the handlebars used in manufacturing its bicycles, which are high-quality racing bikes with limited sales. steele produces and sells only 10,000 bikes each year. due to the low volume of activity, steele is unable to obtain the economies of scale that larger producers achieve. for example, steele could buy the handlebars for $31 each: they cost $34 each to make. the following is a detailed breakdown of current production costs: after seeing these figures, steele's president remarked that it would be foolish for the company to continue to produce the handlebars at $34 each when it can buy them for $31 each. calculate the total relevant cost. do you agree with the president's conclusion?

Match the given situations to the type of risks that a business may face while taking credit. 1. beta ltd. had taken a loan from a bank for a period of 15 years, but its sales are gradually showing a decline. 2. alpha ltd. has taken a loan for increasing its production and sales, but it has not conducted any research before making this decision. 3. delphi ltd. has an overseas client. the economy of the client’s country is going through severe recession. 4. delphi ltd. has taken a short-term loan from the bank, but its supply chain logistics are not in place. a. foreign exchange risk b. operational risk c. term of loan risk d. revenue projections risk