An independent mail delivery service wants to study factors

An independent mail delivery service wants to study factors that affect the daily gas usage of its delivery trucks. Using data collected from different trucks on various days, a company analyst uses a software to fit a regression model of the form

where

1. Holding the other variable fixed, what is the average change in daily fuel used for each additional mile that a truck is driven? (    ) gallon(s)

2. Is this change an increase or a decrease?

Solution

1.         The coefficient of x4 is 0.1. Holding the other variable fixed, the average change in daily fuel used for each additional mile that a truck is driven is 0.1 gallon(s).

2.          Since the coefficient of x4 is 0.1 (positive), this change is an increase.