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Essentials Of Business Analytics
1st Edition
ISBN: 9781285187273
Author: Camm, Jeff.
Publisher: Cengage Learning,
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Textbook Question
Chapter 4, Problem 15P
The U.S. Department of Energy’s Fuel Economy Guide provides fuel efficiency data for cars and trucks. A portion of the data for 311 compact, midsized, and large cars follows. The Class column identifies the size of the car: Compact, Midsize, or Large. The Displacement column shows the engine’s displacement in liters. The FuelType column shows whether the car uses premium (P) or regular (R) fuel, and the HwyMPG column shows the fuel efficiency rating for highway driving in terms of miles per gallon. The complete data set is contained in the tile FuelData:
- a. Develop an estimated regression equation that can be used to predict the fuel efficiency for highway driving given the engine’s displacement. Test for significance using the 0.05 level of significance. How much of the variation in the sample values of HwyMPG does this estimated regression equation explain?
- b. Create a scatter chart with HwyMPG on the y-axis and displacement on the x-axis for which the points representing compact, midsize, and large automobiles are shown in different shapes and/or colors. What does this chart suggest about the relationship between the class of automobile (compact, midsize, and large) and HwyMPG?
- c. Now consider the addition of the dummy variables ClassMidsize and ClassLarge to the simple linear regression model in part (a). The value of ClassMidsize is 1 if the car is a midsize car and 0 otherwise; the value of ClassLarge is 1 if the car is a large car and 0 otherwise. Thus, for a compact car, the value of ClassMidsize and the value of ClassLarge are both 0. Develop the estimated regression equation that can be used to predict the fuel efficiency for highway driving, given the engine’s displacement and the dummy variables ClassMidsize and ClassLarge. How much of the variation in the sample values of HwyMPG is explained by this estimated regression equation?
- d. Use significance level of 0.05 to determine whether the dummy variables added to the model in part (c) are significant.
- e. Consider the addition of the dummy variable FuelPremium, where the value of FuelPremium is 1 if the car uses premium fuel and 0 if the car uses regular fuel. Develop the estimated regression equation that can be used to predict the fuel efficiency for highway driving given the engine’s displacement, the dummy variables ClassMidsize and ClassLarge, and the dummy variable FuelPremium. How much of the variation in the sample values of HwyMPG does this estimated regression equation explain?
- f. For the estimated regression equation developed in part (e), test for the significance of the relationship between each of the independent variables and the dependent variable using the 0.05 level of significance for each test.
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Bicycling World, a magazine devoted to cycling, reviews hundreds of bicycles throughout the year. Its "Road-Race" category contains reviews of bicycles used by riders primarily interested in racing. One of the most important factors in selecting a bicycle for racing is the weight of the bicycle. The following data show the weight (pounds) and price ($) for ten racing bicycles reviewed by the magazine.
Click on the datafile logo to reference the data.
Model
Weight (lb)
Price ($)
Fierro 7B
17.9
2,200
HX 5000
16.2
6,350
Durbin Ultralight
15.0
8,470
Schmidt
16.0
6,300
WSilton Advanced
17.3
4,100
Bicyclette vélo
13.2
8,700
Supremo Team
16.3
6,100
XTC Racer
17.2
2,680
D'Onofrio Pro
17.7
3,500
Americana #6
14.2
8,100
How much of the variation in the prices of the bicycles in the sample does the regression model you estimated in part (b) explain? If required, round your answer to the nearest whole number. Do not round intermediate…
Chapter 4 Solutions
Essentials Of Business Analytics
Ch. 4 - Bicycling World, a magazine devoted to cycling,...Ch. 4 - In a manufacturing process the assembly line speed...Ch. 4 - Jensen Tire Auto is deciding whether to purchase...Ch. 4 - A sociologist was hired by a large city hospital...Ch. 4 - The regional transit authority for a major...Ch. 4 - A marketing professor at Givens College is...Ch. 4 - The Dow Jones Industrial Average (DJIA) and the...Ch. 4 - The Toyota Camry is one of the best-selling cars...Ch. 4 - Dixie Showtime Movie Theaters, Inc., owns and...Ch. 4 - Prob. 10P
Ch. 4 - The American Association of Individual Investors...Ch. 4 - The National Football League (NFL) records a...Ch. 4 - Johnson Filtration. Inc., provides maintenance...Ch. 4 - A study investigated the relationship between...Ch. 4 - The U.S. Department of Energys Fuel Economy Guide...Ch. 4 - A highway department is studying the relationship...Ch. 4 - A sample containing years to maturity and...Ch. 4 - In 2011, home prices and mortgage rates fell so...Ch. 4 - A recent 10-year study conducted by a research...Ch. 4 - The Scholastic Aptitude Test (or SAT) is a...Ch. 4 - Consider again the example introduced in Section...Ch. 4 - Alumni donations are an important source of...
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