The marketing manager of a large supermarket chain would lik

The marketing manager of a large supermarket chain would like to use shelf space to predict sales of pet food A random sample of 12 equal-sized stores is selected. The shelf space (X) sales for the week in dollars (Y) are observed Is it necessary to compute the Durbin-Watson statistic in this case? Explain. Under what circumstances is it necessary to compute the Durbin-Watson statistic before proceeding with the least-squares method of regression analysis?\' No, because the data were not collected over time Yes, it is always necessary to compute the Durbin-Watson statistic. Select the correct answer below. If a larger number of stores had been selected, it would be necessary to compute the Durbin-Watson statistic. If a single store had been selected and studied over a period of time, it would be necessary to compute the Durbin-Watson statistic. It is always necessary to compute the Durbin-Watson statistic. If fewer stores had been selected, it would be necessary to compute the Durbin-Watson statistic.

Solution

Durbin Watson test is used to detect the presence of autocorrelation in a time series.

a. The given data is not a time series, the data is not recorded over different times.

So ,

Answer: C. No, because the data were not collected over time

b. Answer: B. If a single store had been studied over time, it would be necessary to compute the DW statistic.