An analyst fits the following regression model using 1,000 sample data: Profit = 30.23 + 20.62 Service Quality + 5.25 Product Quality + ε The Service Quality was recorded on a 6-point Likert scale by their customers, while the Product Quality was rated at 0 – 100 marks by the engineers. The analyst finds that the p-value of the Global F test is 0.000001, and the p-values of the two individual t tests are 0.045 and 0.039 respectively. The 4 assumptions about the random error term are all satisfied. Taking 5% significance level, the analyst concludes that Product Quality is a less important factor than Service Quality in affecting the Profit, hence he recommends the company to put all resources in enhancing the Service Quality in order to maximize Profit. Do you agree with his conclusion? List three reasons to support your a
An analyst fits the following regression model using 1,000 sample data: Profit = 30.23 + 20.62 Service Quality + 5.25 Product Quality + ε The Service Quality was recorded on a 6-point Likert scale by their customers, while the Product Quality was rated at 0 – 100 marks by the engineers. The analyst finds that the p-value of the Global F test is 0.000001, and the p-values of the two individual t tests are 0.045 and 0.039 respectively. The 4 assumptions about the random error term are all satisfied. Taking 5% significance level, the analyst concludes that Product Quality is a less important factor than Service Quality in affecting the Profit, hence he recommends the company to put all resources in enhancing the Service Quality in order to maximize Profit. Do you agree with his conclusion? List three reasons to support your answer
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