The additive model
Let Meetings be client meetings per month and let Coaching equal 1 for salespeople with coaching and 0 otherwise.
Meetings coefficient: 2.5
If we have two sales people with the same level of coaching but one has one more meeting, that one is predicted to make $2.5k more in sales.
Coaching coefficient: 8
At the same number of meetings, coaching predicts $8k more sales.
Model lab
Move the sliders and compare the two groups at the same number of meetings. Switch the reference category to see coefficients re-expressed.
| Term | Interpretation | Coefficient ($k) |
|---|
Why the lines stay parallel
In this additive model, the effect of each additional meeting is the same in both groups. Coaching shifts the prediction by a constant amount, so the vertical distance between the two lines stays the same at every number of meetings.
Quick check
In Sales = 35 + 2.5(Meetings) + 8(Coaching), what does the 8 mean?