HW4Solns

# HW4Solns - BUAD 310 Homework 4 Solutions Due Tuesday in...

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- 1 - BUAD 310 Homework 4 Solutions Due Tuesday, April 21, 2009 in class All problems with page numbers are from the textbook: 1. p. 555 #13.11 a. b 0 = 29.347, b l = 5.6128, b 2 = 3.8344 b 0 is meaningless since we do not have data where size and rating are 0. b 1 = 5.6128 implies that we estimate that mean sales price increases by \$5,612.80 for each increase of 100 square feet in house size, when the niceness rating stays constant. b 2 = 3.8344 implies that we estimate that mean sales price increases by \$3,834.40 for each increase in niceness rating of 1, when the square footage remains constant. b. 172.28 [from y = 29.347 + 5.6128(20) + 3.8344(8)] 2. p. 555 #13.12 a. b 0 = 7.5891, b l = –2.3577, b 2 = 1.6122, b 3 = 0.5012 b. y = 7.5891 – 2.3577(3.70) + 1.6122(3.90) + .5012(6.50) = 8.41099 In other words, the predicted demand is 841,099 bottles. Note : There will be small differences in the answers due to rounding, that’s OK. c. sales revenue = (\$3.70)(841,099 bottles) = \$3,112,066 Note : There will be small differences in the answers due to rounding, that’s OK. 3. p. 563 #13.17 [parts 1, 2, 3, 4, and 7 only] 1) 242 . 3 5 . 10 ; 5 . 10 7 6 . 73 ) 1 2 ( 10 6 . 73 ) 1 ( ; 6 . 73 2 s k n SSE s SSE 2) Total variation = 7447.5 Unexplained variation = 73.6 Explained variation = 7374 3) 99 . 5 . 7447 7374 2 R 987 . ) 1 2 ( 10 1 10 1 10 2 99 . ) 1 ( 1 1 2 2 k n n n k R R

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- 2 - 2 R and are close together and close to 1. 4) F(model) 7) p -value = 0.00 (which means less than .001). Since this p -value is less than = .10, .05, .01, and .001, we have extremely strong evidence that 0 : 2 1 0 H is false. That is, we have extremely strong evidence that at least one of x 1 and x 2 is significantly related to y . 4.
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## This note was uploaded on 09/05/2010 for the course BUAD 310 taught by Professor Lv during the Spring '07 term at USC.

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HW4Solns - BUAD 310 Homework 4 Solutions Due Tuesday in...

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