Regression Model for Profitability in La Quinta Inns
What are the predictive variables chosen by the profitability regression model used by La Quinta Inns?
Which of the following is NOT one of the predictive variables chosen by the profitability regression model used by La Quinta Inns?
A) the price of the inn
B) median income levels
C) the state population per inn
D) the location of nearby colleges
E) the number of inns in a region
Final answer:
The profitability regression model used by La Quinta Inns does not include the location of nearby colleges as a predictive variable. The model includes the price of the inn, median income levels, the state population per inn, and the number of inns in a region.
La Quinta Inns uses a regression model to predict profitability, which involves analyzing several variables to determine their impact on the financial performance of the inns. The selected predictive variables help the company make informed decisions and strategies based on data-driven insights.
The profitability regression model used by La Quinta Inns incorporates the price of the inn, median income levels, the state population per inn, and the number of inns in a region as key factors influencing profitability. By excluding the location of nearby colleges as a predictive variable, the model focuses on variables that are more directly related to the performance of the inns.
Regression models, such as the one used by La Quinta Inns, play a crucial role in business analysis by identifying and quantifying relationships among variables. This enables businesses to understand the impact of different factors on profitability and make informed decisions to optimize performance and achieve strategic goals.