Segment& 3& (20 points)& –& use the below table for all questions related to Segment 3You are the brand manager for a national brand of soft drinks. You are considering anational advertising campaign for the month of June. Your options are to spend $1M,$2M or $3M on that campaign. You have access to historical data that links monthlysales to advertising spending. You regress monthly wholesale sales (in number of cases)on monthly dummy variables, on the amount (in dollar) spent on advertising during thesame month, on this amount squared, on the amount spent on advertising the previousmonth (lagged advertising spending), and on this amount squared. The output from theregression is reproduced below.& & Coefficients P-valueIntercept 1,504,957 0Jan -534,891 0Feb -493,373 0Mar -393,334 0Apr -430,343 0.01May -237,217 0Jul 235,276 0Aug 356,731 0Sep -34,012 0Oct -105,955 0Nov -298,864 0Dec -426,838 0advertising spending 0.9 0.03(advertising spending) -0.00000009 0.032lagged advertising spending -0.24 0.03(lagged advertising spending) 0.00000004 0.03& Your contribution (i.e., margin) per case of soft drinks is $2.21& ptsQuestion 19On average 1,504,957 cases are sold in amonth in June if there is no advertising inJune and there was no advertising in MayOn average 1,504,957 cases are sold permonth in the dataProfit is maximized when $1,504,957 is spenton advertisingQ3.1: What is the meaning of the intercept in the above table?2& ptsQuestion 20There is no data for JuneJune is set as the baselineThis is a mistakeQ3.2: Why does the table not include a coefficient for June?2& ptsQuestion 21Each coefficient represents the averagenumber of cases sold that monthEach coefficient represents the averagenumber of cases sold that month comparedto JuneEach coefficient represents the averageadvertising spending that monthQ3.3: Interpret the signs of the month dummy variables.2& ptsQuestion 22Increasing advertising budget in a givenmonth tends to decrease demand that monthand increase demand the next monthIncreasing advertising budget in a givenmonth tends to increase demand that monthand increase demand the next monthIncreasing advertising budget in a givenmonth tends to increase demand that monthand decrease demand the next monthQ3.4: Interpret the signs and magnitudes of the coefficients for “advertising spending”and “lagged advertising spending.”2& ptsQuestion 23There are diminishing returns to advertisingThere are constant returns to advertisingQ3.5: Interpret the signs of the coefficients for “(advertising spending) ” and “(laggedadvertising spending) ” 22There are increasing returns to advertising3& ptsQuestion 24$200,000$220,000$240,000Q3.6: According to the regression results, what will your total incremental profit be ifyou spend $1M on advertising in June?3& ptsQuestion 25$160,000$240,000$320,000Q3.7: According to the regression results, what will your total incremental profit be ifyou spend $2M on advertising in June?3& ptsQuestion 26-$120,000$60,000$240,000Q3.8: According to the regression results, what will your total incremental profit be ifyou spend $3M on advertising in June?2& ptsQuestion 27$1M$2M$3MQ3.9: According to the regression results, should you spend $1M, $2M, or $3M onadvertising in June?转自：http://ass.3daixie.com/2018052158549062.html