Management 6005 takehome quiz 6

Management 6005 takehome quiz 6 - Mohammad Yahya Aladalh...

Info icon This preview shows pages 1–2. Sign up to view the full content.

View Full Document Right Arrow Icon
Mohammad Yahya Aladalh Management 6005 – Mohammad Yahya Aladalh Take-home Quiz 6 – Honor code applies: Do not talk to your classmates 1. Evaluate each of the following statements: a. ‘’In a multiple regression model, the coefficients on the explanatory variables measure the percent of the total variation in the dependent variable Y explained by that explanatory variable.’’ First of all, it is obvious that unit demand which is the dependent variable Y, is assumed to change with changes in each independent variable. However, the coefficient of determination or R 2 , shows how well a multiple regression model explains changes in the value of the dependent Y variable. If the R 2 equals 0, then the coefficients and the model sometimes provide no explanation of the variation in the dependent variable, but if it equals 1.0, then all the variation is explained by the independent variables. Another example, if the coefficient of determination for the regression model is 85, then 85 percent of the total variation of the unit sales can be explained by the underlying variation in the independent variable; therefore, a relatively high level of explanatory power id realized. Moreover, if R 2 is 0, then the regression model can not explain an variation in the dependent Y variable even though it is seldom that coefficient of determination equals 0. In addition, the type of analysis and anticipated use of statistical results must be considered. For example, demand and cost analysis over time will lead to higher levels for coefficient of determination than would a similar analysis across firms at a given time. This is
Image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full Document Right Arrow Icon
Image of page 2
This is the end of the preview. Sign up to access the rest of the document.

{[ snackBarMessage ]}

What students are saying

  • Left Quote Icon

    As a current student on this bumpy collegiate pathway, I stumbled upon Course Hero, where I can find study resources for nearly all my courses, get online help from tutors 24/7, and even share my old projects, papers, and lecture notes with other students.

    Student Picture

    Kiran Temple University Fox School of Business ‘17, Course Hero Intern

  • Left Quote Icon

    I cannot even describe how much Course Hero helped me this summer. It’s truly become something I can always rely on and help me. In the end, I was not only able to survive summer classes, but I was able to thrive thanks to Course Hero.

    Student Picture

    Dana University of Pennsylvania ‘17, Course Hero Intern

  • Left Quote Icon

    The ability to access any university’s resources through Course Hero proved invaluable in my case. I was behind on Tulane coursework and actually used UCLA’s materials to help me move forward and get everything together on time.

    Student Picture

    Jill Tulane University ‘16, Course Hero Intern