Case Study - Brandon Lang Mon/Wed 4-6 BUAD 310 Case Study 1...

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Brandon Lang December 11, 2007 Mon/Wed 4-6 BUAD 310 Case Study 1. a. The histograms for the cost of an ad and the circulation are skewed to the right and unimodal. The histogram for median income appears to be fairly normal with no skewness. The histogram for the percent of male readers also appears to have no skewness and is bimodal making it reasonably symmetric. b. The relationship between page cost and circulation appears to have a curved relationship, not a linear one. There appear to be two possible outliers but the overall plot has a slight curve shape. There appears to be no strong linear relationship between page cost and the percent of male readers. The plot is rather scattered showing no evidence of a strong relationship. There also appears to be no strong linear relationship between page cost and median income. The plot looks as if it could possibly have a slight curved relationship but there is no strong relationship apparent. 2. The regression equation is pagecost = - 8643 + 5.28 circ - 11.0 percmale + 1.22 medianincome Predictor Coef SE Coef T P VIF Constant -8643 12291 -0.70 0.486 circ 5.2815 0.5304 9.96 0.000 1.082 percmale -11.00 77.20 -0.14 0.887 1.377 medianincome 1.2226 0.5355 2.28 0.027 1.426 S = 13129.3 R-Sq = 69.4% R-Sq(adj) = 67.3% Analysis of Variance Source DF SS MS F P Regression 3 17219203510 5739734503 33.30 0.000 Residual Error 44 7584600772 172377290 Total 47 24803804282 a. The multiple regression model seems to be useful. The value is 69.4% which means that almost 70% of the variation is explained by the model. Also, the model is statistically significant at the α=.05 level based on the F-value of 33.30 that has an approximate p-value of 0.000. b. The estimated regression equation is: Pagecost = - 8643 + 5.28 (circulation) – 11.0 (% male) + 1.22 (median income) c. Multicollinearity does not appear to be a problem based on the VIF values. The VIF values are all less than five which means they are not a concern.
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d. Circulation and median income both contribute significantly to the model at the α=.05 level. This is based on the p-values of 0.000 and 0.027 for circulation and median income, respectively. The percent of male readers does not seem to contribute to the model significantly. This variable’s p-value of 0.887 is not significant at the α=.05
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