Quantitative Methods Lab #5

Chapters 14-15: Regression Techniques and Analysis

This lab will use data found in Case Problem 1, “Consumer Research, Inc.” at the end of Chapter 15 of the textbook. Complete all parts of the Managerial Report found in the book, with additional (or alternative) instructions and components found below.

Put your name in cell A1 and the date in A2 and save the file as “Lab 5 Consumer_yournames”.

1. Rather than creating descriptive statistics, create two scatter plot graphs. Each graph should have the amount charged on the vertical axis but a different independent variable on the horizontal axis. Add a linear trend line to each graph. Comment on what relationships you see in the graphs and whether they make economic sense. Make sure the graphs have appropriate titles and axis labels. (6 points)

2. For each of these regression equations you must carefully and thoroughly provide the following:

· Interpretations of slope and intercept coefficients.

· Interpretation of R².

· T-tests of statistical significance (including the appropriate null and alternative hypotheses) for each estimated coefficient.

In your lab report, clearly separate discussion into parts 2a (income is the independent variable) and 2b (household size is the independent variable). (12 points)

3. For this regression equation you must carefully and thoroughly provide the following:

· Interpretations of slope and intercept coefficients.

· Interpretation of R² and adjusted R².

· T-tests of statistical significance (including the appropriate null and alternative hypotheses) for each estimated coefficient.

· F-test of overall significance (including the appropriate null and alternative hypotheses).

(20 points)

4. (4 points)

5. Specify two additional variables that could be included in the model. Be sure you justify the inclusion of these additional variables and how you would measure them. (8 points)