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FINA 6206: Finance Seminar Multiple Linear Regression (1 of 2) With multiple linear regression, we want to model the linear relationships between multiple independent, or explanatory variables, and the dependent variable, Sales. In our example, the relationship we now want to model looks like this: Salest= a + b1(Pricet) + b2(Advertisingt) + b3(IRt) + b4(Montht) + etThis says Sales in month t is influenced by four contemporaneous variables: price per car, advertising expenditure, interest rates, and time trend. But what about "e"? As with 0
FINA 6206: Finance Seminar As before, open the box for regression analysis inputs. You need to complete three fields in this box. Input Y Range: A2:A41 (This is your dependent variable, Sales.) Input X Range: B2:E41 (These are your independent variables, Price, Advertising, IR, and Month.) Output Range: G22 (This is just where Excel will start writing the results. We are being careful not to overwrite our previous analysis.) Click OK. The following output should appear on the spreadsheet. (Note that Excel does not label the independent variables in the regression output. They are listed in the sequence they appear on the spreadsheet.): Log in to the course to access alternative version.