LIR832 Computer Problem Set 3

LIR832 Computer Problem Set 3 - LIR 832 A Computer Problem...

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LIR 832: A Computer Problem Set on Regression: This problem set is intended to familiarize you with regression in MINITAB and provide an initial opportunity to interpret regression output. You will need to download the company sales data set and the accompanying documentation from the web site. 1. Load the company sales data set and obtain descriptive statistics for all of the variables in the data set. What is the definition of each variable? What are the units for each variable. 2. Lets investigate the factors which influence profits. a. To start, regress market valuation (MV) on sales (MV is the dependent variable, sales is the explanatory variable). Under results get regression equation, table of contents, etc. Based on these estimates, what is the relationship between sales and MV (tell me exactly how much MV rise for a \$1.00 increase in sales). Test the hypothesis that MV increases with sales. Can the null be rejected? Now test the hypothesis that MV rises dollar for dollar with sales (the coefficient would be \$1.00). Is there support for this hypothesis? How well does the equation fit the data (what is r 2 and r-bar-square)? Under the regression command, select the fitted line command. Make MV the Y variable and sales the X variable. What does the resulting graph depict? What does it tell you about the regression? As a note, you can copy the graph by right clicking the graph, making it easy to place the

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LIR832 Computer Problem Set 3 - LIR 832 A Computer Problem...

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