(A) Phoenix Lumber Company uses the number of construction permits issued to help estimate demand (sales). The firm collected the following data on annual sales and number of construction permits issued in its market area: No. of Construction Sales Year Permits Issued (000) (1,000,000) 2003 6.50 10.30 2004 6.20 10.10 2005 6.60 10.50 2006 7.30 10.80 2007 7.80 11.20 2008 8.20 11.40 2009 8.30 11.30 (a) Which variable is the dependent variable and which is the independent variable? (b) Determine the estimated regression line. (c) Calculate the coefficient of determination. Give an economic interpretation to the value obtained. (d) Suppose that 8,000 construction permits are expected to be issued in 2010. What would be the point estimate of Phoenix Lumber Company's sales for 2010? Q 3. (B) Following output for the multiple regression problem shows results as results. SUMMARY OUTPUT Regression Statistics Multiple R 0.70955 R Square 0.503461 Adjusted R Square 0.410359 Standard Error 2.130054 Observations 20 ANOVA df SS MS F Significance F Regression 3 73.60593 24.53531 5.40767 0.0092117 Residual 16 72.59407 4.537129 Total 19 146.2 Coefficients Standard Error t Stat P-value Lower 95% Upper 95% Intercept 48.63081 6.3247384 7.688984 9.2E-07 35.222968 62.038661 Price of Coke -0.3035 0.1711745 -1.77307 0.09525 -0.6663779 0.0593694 Ad Expenditure 0.342937 0.1655882 2.071021 0.05489 -0.0080947 0.6939678 Pepsi Price 0.23406 0.1393504 1.679653 0.11244 -0.0613493 0.5294699 Find and Interpret Adjusted Coefficient of Determination, Adjusted R2, and the Correlation Coefficient, R. The ANOVA table gives the F statistic for testing the claim that there is no significant relationship between your all of your independent and dependent variables. The sig. value is your p value. Using p-value decide you should Reject or Accept claim. Write the Fitted Regression line from the results? Decide about significance using the p-value.
- (A)
Phoenix Lumber Company uses the number of construction permits issued to help estimate demand (sales). The firm collected the following data on annual sales and number of construction permits issued in its market area:
|
No. of Construction |
Sales |
Year |
Permits Issued (000) |
(1,000,000) |
|
|
|
2003 |
6.50 |
10.30 |
2004 |
6.20 |
10.10 |
2005 |
6.60 |
10.50 |
2006 |
7.30 |
10.80 |
2007 |
7.80 |
11.20 |
2008 |
8.20 |
11.40 |
2009 |
8.30 |
11.30 |
(a) |
Which variable is the dependent variable and which is the independent variable? |
(b) |
Determine the estimated regression line. |
(c) |
Calculate the coefficient of determination. Give an economic interpretation to the value obtained. |
(d) |
Suppose that 8,000 construction permits are expected to be issued in 2010. What would be the point estimate of Phoenix Lumber Company's sales for 2010?
|
Q 3. (B)
Following output for the multiple regression problem shows results as results.
SUMMARY OUTPUT |
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Regression Statistics |
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Multiple R |
0.70955 |
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R Square |
0.503461 |
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Adjusted R Square |
0.410359 |
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Standard Error |
2.130054 |
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Observations |
20 |
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ANOVA |
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df |
SS |
MS |
F |
Significance F |
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Regression |
3 |
73.60593 |
24.53531 |
5.40767 |
0.0092117 |
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Residual |
16 |
72.59407 |
4.537129 |
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Total |
19 |
146.2 |
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Coefficients |
Standard Error |
t Stat |
P-value |
Lower 95% |
Upper 95% |
Intercept |
48.63081 |
6.3247384 |
7.688984 |
9.2E-07 |
35.222968 |
62.038661 |
Price of Coke |
-0.3035 |
0.1711745 |
-1.77307 |
0.09525 |
-0.6663779 |
0.0593694 |
Ad Expenditure |
0.342937 |
0.1655882 |
2.071021 |
0.05489 |
-0.0080947 |
0.6939678 |
Pepsi Price |
0.23406 |
0.1393504 |
1.679653 |
0.11244 |
-0.0613493 |
0.5294699 |
- Find and Interpret Adjusted Coefficient of Determination, Adjusted R2, and the Correlation Coefficient, R.
- The ANOVA table gives the F statistic for testing the claim that there is no significant relationship between your all of your independent and dependent variables. The sig. value is your p value. Using p-value decide you should Reject or Accept claim.
- Write the Fitted Regression line from the results?
- Decide about significance using the p-value.
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