Question

A retail analyst runs a simple linear regression predicting monthly sales from advertising spend. The model reports a slope coefficient with a p-value of 0.002 and an R-squared of 0.18. The marketing director wants to know what these two results together tell them about the relationship. What is the most accurate interpretation?

Accepted Answer

Advertising spend has a statistically significant relationship with sales, but it explains only about 18% of the variation in sales.

Answer

The relationship is not statistically significant because R-squared is well below 0.50.

Answer

Advertising spend explains 82% of the variation in sales, and the low p-value confirms this strong fit.

Answer

Because the p-value is significant, the model can reliably predict individual monthly sales figures with high accuracy.