A farming syndicate intends to analyze the effect of per capita income (EUR thousand/capita/year), price of potato (EUR /kilogram), and regional status (City = 1 and Regency = 0) on average potato consumption per capita in a week (kilogram/capita/week) in Ulster Province of Ireland (consists of 6 cities and 29 regencies) in 2009. The regression results are as follows.
Correlation
Correlation defines a relationship between two independent variables. It tells the degree to which variables move in relation to each other. When two sets of data are related to each other, there is a correlation between them.
Linear Correlation
A correlation is used to determine the relationships between numerical and categorical variables. In other words, it is an indicator of how things are connected to one another. The correlation analysis is the study of how variables are related.
Regression Analysis
Regression analysis is a statistical method in which it estimates the relationship between a dependent variable and one or more independent variable. In simple terms dependent variable is called as outcome variable and independent variable is called as predictors. Regression analysis is one of the methods to find the trends in data. The independent variable used in Regression analysis is named Predictor variable. It offers data of an associated dependent variable regarding a particular outcome.
A farming syndicate intends to analyze the effect of per capita income (EUR thousand/capita/year), price of potato (EUR /kilogram), and regional status (City = 1 and Regency = 0) on average potato consumption per capita in a week (kilogram/capita/week) in Ulster Province of Ireland (consists of 6 cities and 29 regencies) in 2009. The regression results are as follows.
Summary Outpot
| Multiple R | 0.9542 |
| R Square | 0.9106 |
| Adjusted R Square | ......... |
| Standard Error | 0.0585 |
| Observations | 35 |
ANOVA
| df | SS | MS | F | Significance F | |
| Regression | ......... | ......... | ......... | ......... | 0.0000 |
| Residual | ......... | 0.1060 | ......... | ||
| Total | ......... | 1.1860 |
| Coefficients | Standard Error | t Stat | P-value | |
| Intercept | 0.1534 | 0.1057 | ......... | 0.1567 |
| Income per Capita | 0.1399 | 0.0091 | ......... | 0.0000 |
| Price | -0.0066 | 0.0075 | ......... | 0.3831 |
| Regional Status | -0.2424 | 0.0397 | ......... | 0.0000 |
a. Find the missing values in the tables.
b. Formulate the estimated regression equation.
c. Using ANOVA, find the global test and interpret the result.
d. Using α = 5%, are those independent variables significant?
e. Interpret:
1. The Income per Capita coefficient.
2. The Regional Status coefficient.
f. What is the average rice consumption per capita in a week in Donegal Regency if the income per capita is EUR 8 thousand/capita/year and the price of potato is EUR 9 / kilogram?
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