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PGEMP62/A/06
Quantitative Methods – Assignment: 02
ata we have
Analysis, we have A = 163.77 B = 10.73 C = -284.2543 (R Square - 0.83, P values < 0.05)
Standard Error = 2168
relation ship between Asset Value , Size of House and Age is as Follows
e v/s Residual Plot and Size of Plot v/s Residual Plot we can infer that some other variable is also influencing the assed value
size of house and age which has not been captured.
,7 & 10 are having low residuals, indicating Linear relationship between assessed value, size of house and Age as proposed by us
2,3,4,5,6,8,9 are having high residuals indicating that proposed model doesn't suit these
g the assed value
Age as proposed by us
SUMMARY OUTPUT
Regression Statistics
Multiple R 0.9091201073
R Square 0.8264993695
Adjusted R Square 0.7975825977
Standard Error 2168.16552667
Observations 15
ANOVA
df SS MS
Regression 2 268724698.9875 134362349.493758
Residual 12 56411301.01248 4700941.75104028
Total 14 325136000
RESIDUAL OUTPUT
F Significance F
Age (years) Residual Plot
28.58201 2.72776118203818E-05 4000
2000
Residuals
0
0 5 10 15 20 25 30
-2000
P-value Lower 95% Upper 95%
Lower 95.0%
Upper 95.0%
-4000
1.05E-12 151993.905361787 175556.3 151993.9 175556.3
Age (years)
0.003938 4.1575282274 17.29284 4.157528 17.29284
0.005267 -466.3995254476 -102.109 -466.4 -102.109
PROBABILITY OUTPUT
0 15 20 25 30 35
Age (years)
Lokesh Kumar Byrica
PGEMP62/A/06
Quantitative Methods – Assignment: 02
No. of existing
customers
70000 A) In Given Data we have
43000
31000 One dependent Variance (Z) - Sales
10000 Six Independent Variables - S (No of delivery boys), T (Advertisement cost), U (No. of Outlets), V
17000 (Varities of Pizza), W (Competitors activity Index), X (No. of existing customers)
8000
39000 We propose following linear equation showing relationship between the three variables
40000
30000 Z = A + B(S) + C(T) + D(U) + E(V) + F(W) + G(X) + Standard Error
16000
30000 where A, B, C, D, E, F & G are constants
20000
25000 From Data Analysis, we have A = 6.372 B = 0.92 C = 0.001 (R Square - 0.95, P values < 0.0
50000 found that D = 1.62 E = -1.98 F = 0.07 G = 0.0002
20000
Hence, our proposed equation is not valid as Sales is dependent on No. of Outlets only.
So, new equation proposed is
Z = A+ D(U)
From Data Analysis, we have A = -13.01 (R Square - 0.90, P values < 0.0000005 for No. of Out
found that D = 2.5 Standard Error = 6.91
R = 0.95 R2 = 0.91
The R and R2 values are closer to 1, this implies that the predicted linear relationship model is be
suiting for the given data
nt cost), U (No. of Outlets), V
customers)
Regression Statistics
Multiple R 0.9764012718
R Square 0.9533594436
Adjusted R Square 0.9183790263
Standard Error 6.2603561839
Observations 15
ANOVA
df SS MS F Significance F
Regression 6 6408.863524 1068.144 27.25409006 6.58E-05
Residual 8 313.5364764 39.19206
Total 14 6722.4
RESIDUAL OUTPUT
Regression Statistics
Multiple R 0.9526746583
R Square 0.9075890046
Adjusted R Square 0.9004804665
Standard Error 6.9127734343
Observations 15
ANOVA
df SS MS F Significance F
Regression 1 6101.176 6101.176 127.67590063 4.29E-08
Residual 13 621.2237 47.78644
Total 14 6722.4
RESIDUAL OUTPUT
Years at Other debt in Debt to income Household Years with current Credit card debt
Age current income in
address thousands ratio (x100) employer in thousands
thousands
41 12 5010 0.093 176000 17 11360
27 6 4000 0.173 31000 10 1360
40 14 2170 0.055 55000 15 860
41 14 820 0.029 120000 15 2660
24 0 3060 0.173 28000 2 1790
41 5 2160 0.102 25000 5 390
39 9 16670 0.306 67000 20 3830
43 11 1240 0.036 38000 12 130
24 4 3280 0.244 19000 3 1360
36 13 2150 0.197 25000 0 2780
27 1 90 0.017 16000 0 180
25 0 940 0.052 23000 4 250
52 14 2470 0.1 64000 24 3930
37 9 3010 0.163 29000 6 1720
48 15 5400 0.091 100000 22 3700
36 6 3400 0.086 49000 9 820
36 6 3810 0.164 41000 13 2920
43 19 4290 0.076 72000 23 1180
39 9 2910 0.057 61000 6 560
41 21 340 0.017 26000 0 100
Batch No:62
Contact 0
tive Methods – Assignment: 02
Customer A)
risk
In Given Data we have
0.45
0.55 One dependent Variance (Z) - Customer Risk
0.65 Seven Independent Variables - S (Age), T (Years with Current Employer), U (Years at current
0.75 (Household income), W (Debt to income ratio), X (Credit card debt), Y (Other debt)
0.55
0.95 We propose following linear equation showing relationship between the three variables
0.32
0.88 Z = A + B(S) + C(T) + D(U) + E(V) + F(W) + G(X) + H(Y) + Standard Error
0.65
0.87 where A, B, C, D, E, F, G & H are constants
0.64
0.72 From Data Analysis, we have A = -0.0019B = 0.024 C = -0.005
0.71 found that D = -0.021 E = 0 F = 1.76
0.86 Hence, the revised linear equation showing relation between Customer risk and factors is a
0.58
0.88 Z = A + B(S) + D(U) + F(W) + H(Y) + Standard Error
0.77
0.57 From Data Analysis, we have A = 0.201 B = 0.01856
0.65 found that D = -0.019 F = -0.00005
0.5
Age & Other debt has direct influence on customer risk and Years at current address has
rent Employer), U (Years at current address), V
card debt), Y (Other debt)
andard Error
(R Square - 0.75, P values < 0.05 for Age, Years at current address, debt to income ratio, other debt only)
G=0 H=0
ween Customer risk and factors is as follows
H = 1.2
Regression Statistics
Multiple R 0.867935
R Square 0.753311
Adjusted R Square 0.609409
Standard Error 0.102543
Observations 20
ANOVA
df SS MS F Significance F
Regression 7 0.385319 0.055046 5.23489 0.006222
Residual 12 0.126181 0.010515
Total 19 0.5115
Coefficients
Standard Error t Stat P-value Lower 95%Upper 95%Lower 95.0%
Intercept -0.00192 0.206226 -0.00931 0.992725 -0.45125 0.447408 -0.45125
Age 0.023817 0.006145 3.875905 0.002204 0.010428 0.037205 0.010428
Years with current employer -0.00519 0.005481 -0.94708 0.362278 -0.01713 0.006751 -0.01713
Years at current address -0.02125 0.006565 -3.2374 0.007121 -0.03556 -0.00695 -0.03556
Household income in thousands 2.02E-06 1.74E-06 1.157954 0.26941 -1.78E-06 5.81E-06 -1.78E-06
Debt to income ratio (x100) 1.755406 0.667266 2.630744 0.021946 0.301558 3.209255 0.301558
Credit card debt in thousands -4.22E-05 2.29E-05 -1.84532 0.089799 -9.21E-05 7.63E-06 -9.21E-05
Other debt in thousands -4.93E-05 1.31E-05 -3.77029 0.00267 -7.78E-05 -2.08E-05 -7.78E-05
RESIDUAL OUTPUT
Regression Statistics
Multiple R 0.8016386859
R Square 0.6426245827
Adjusted R Square 0.5473244714
Standard Error 0.1103924895
Observations 20
ANOVA
df SS MS F Significance F
Regression 4 0.328702 0.082176 6.743167 0.00259
Residual 15 0.182798 0.012187
Total 19 0.5115
RESIDUAL OUTPUT
Total market
Months Total sales Total profit A)
capitalization In Given Data we have
October’ 03 714035 856610 66240
May’ 04 1127252 928986 83152 One dependent Variance (Z)
Dec’ 04 1277421 933035 87907
Two Independent Variables -
June’ 05 1459099 1110214 107162
Feb’ 06 1827124 1228046 128107
Aug' 06 2293549 1385556 140437 We propose following linear
We propose following linear equation showing relationship between the three variables
From Data Analysis, we have A = -618407 B = 0.31 C = 16.99 (R Square - 0.968, P values > 0.05 for Total Sales and Total profit
found that F value > P value
Hence, model cannot be rejected.
Market Capitalization = -618407 + 0.31 X Total Sales + 16.99 X Total profit
Conclusion: From the residual plots we can see that as sales & profit values increase, the residual variance is also increasing, thus
limiting the use of this models for higher values of sales and profit.
for Total Sales and Total profit)
Residuals
Adjusted R Square 0.948107 0
-50000
800000 1000000 12
Standard Error 125991.5 -100000
Observations 6 -150000
Total
ANOVA
df SS MS F Significance F
Regression 2 1481852513707 7.41E+11 46.67587 0.0054940494
Residual 3 47621583774 1.59E+10
Total 5 1529474097481
Observation
Predicted Total market capitalization
ResidualsStandard Residuals PercentileTotal market capitalization
1 772059.9 -58024.8877431 -0.59456 8.3333333333 714035
2 1081845 45406.95153387 0.46527 25 1127252
3 1163907 113513.6990671 1.163138 41.6666666667 1277421
4 1545899 -86800.2588706 -0.88941 58.3333333333 1459099
5 1938272 -111148.468842 -1.1389 75 1827124
6 2196496 97052.96485435 0.99447 91.6666666667 2293549
Total sales Residual Plot Total profit Residual Plot
150000
100000 150000
50000 100000
50000
Residuals
0
-50000
800000 1000000 1200000 1400000 1600000 0
-100000 -50000
60000 80000 100000 120000 140000 160000
-150000 -100000
-150000
Total sales
Total profit
Lower 95.0%
Upper 95.0%
-2583117 1346304
-5.05486 5.672926
-21.8072 55.79707
market capitalization
l Plot
0 140000 160000
Lokesh Kumar Byrica
PGEMP62/A/06
Quantitative Methods – Assignment: 02
Cost of Milk =
distance of Milk source from Madison effects the cost of Milk and the relation between the two is a linear relationship.
A = 2.226 B = 0.00025 (R Square - 0.57, P values < 0.05 for Distance from Madison)
are at equidistance from the zero line and it can be said that the relation established between distance and cost of milk is
SUMMARY OUTPUT
Regression Statistics
Multiple R 0.7537798255
R Square 0.5681840253
Adjusted R Square 0.4962146962
Standard Error 0.1016203676
Observations 8
ANOVA
df SS MS F Significance F
Regression 1 0.081527 0.081527 7.894807862 0.030765
Residual 6 0.06196 0.010327
Total 7 0.143488
RESIDUAL OUTPUT
Residuals
0
-0.05200 400 600 800 1000 1200 1400 1600
-0.1
-0.15
Distance from Madison (miles)
Significance F
Upper 95%
Lower 95.0%
Upper 95.0%
2.423177 2.028234 2.423177
0.000469 3.23E-05 0.000469
Lokesh Kumar Byrica
PGEMP62/A/06
Quantitative Method
A = -0.86 B = 0.92 (R Square - 0.405, P values > 0.05 for Number of Units sold)
, we have found that
or is not constant, it is small for small values of units sold and high for high values of
Regression Statistics
Multiple R 0.6361259018
R Square 0.4046561629
Adjusted R Square 0.3196070433
Standard Error 3.7636201147
Observations 9
ANOVA
df SS MS F Significance F
Regression 1 67.39503 67.39503 4.75791125 0.0655183643
Residual 7 99.15385 14.16484
Total 8 166.5489
RESIDUAL OUTPUT
Predicted Sales
Observation ($ billions) Residuals
1 10.547537138 6.552463
2 6.0383111806 1.861689
3 5.3941360438 -0.59414
4 7.1426114152 -2.44261
5 3.3695856138 1.230414
6 3.8297107115 0.170289
7 9.4432369038 -6.54324
8 3.8297107115 -1.12971
9 1.8051602815 0.89484
Number of Units (1000) Residual Plot
10
5
Residuals
0
2 4 6 8 10 12 14
-5
-10
Number of Units (1000)
Lower 95.0%
Upper 95.0%
-8.58363 6.856499
-0.07736 1.917858
Lokesh Kumar Byrica
PGEMP62/A/06
Quantitative Methods – Assignment: 02
Residuals
0
-500 0 200 400 600 800 1000 1200 1400 1600 180
-1000
-1500
-2000
1977
Batch No:62
Contact 0
antitative Methods – Assignment: 02
X2
337561 y - mean 941.81
45369 Standard Error 1038.2404
446224 a 0.05 a/2 0.025
119025 df 4
2178576 t 0.025, 4 2.776
3154176 1/n 0.1666667
6280931
Confidence Interval = 941 +/- 1212.0036
(941-1212 , 941+1212)
77 Residual Plot
t-stat = 3.46211179
Residuals
Adjusted R 0.687163
0
Standard E 1038.24
0 200 400
Observatio 6 -1000
-2000
ANOVA
df SS MS F Significance F
Regression 1 12916729 12916729 11.98275 0.02578
Residual 4 4311773 1077943
Total 5 17228502
Coefficients
Standard Error t Stat P-value Lower 95%Upper 95%
Lower 95.0%
Upper 95.0%
Intercept -830.59 748.2711 -1.11001 0.329226 -2908.12 1246.944 -2908.12 1246.944
1977 2.531634 0.731346 3.461612 0.02578 0.501093 4.562175 0.501093 4.562175
RESIDUAL OUTPUT
Observation
Predicted 2009
Residuals
1 640.2899 5.710087
2 -291.351 491.3515
3 860.5421 -387.542
4 42.82425 70.17575
5 2906.102 -1486.1
6 3665.593 1306.407
1977 Residual Plot
2000
1000
Residuals
0
0 200 400 600 800 100012001400160018002000
-1000
-2000
1977
Lokesh Kumar Byrica
PGEMP62/A/06
Quantitative Methods – Ass
Residual Square X2
39692.516 1151329 Standard Error 1254.2685
2902655.829 23990404 N = 7
208472.417 11189025 1/n = 0.1428571
77067.809 10863616 t stat = -1.577273
30201.027 7963684 t 0.025, 5 2.571
118757.999 6640929 Observed t value = -19.32981
4489099.377 687241
7865946.9729307 62486228 Conclusion:
since observed t stat value is in rejection zone, the slope of the regression lin
significantly different from zero
Residual Plots
The variance in error is not constant, it is high for small values of revenue an
high values of revenue.
h No:62
ntact 0
3757.2795
-7.063962
Regression Statistics
Multiple R 0.5764081347
R Square 0.3322463378
Adjusted R Square 0.1986956053
Standard Error 1254.2684699004
Observations 7
ANOVA
df SS MS F Significance F
Regression 1 3913767 3913767 2.487791 0.175559
Residual 5 7865947 1573189
Total 6 11779714
RESIDUAL OUTPUT
Residuals
0
-2000 50 100 150 200 250 300 350 400 450
-4000
Revenues
($ billions)
Lower 95.0%
Upper 95.0%
1635.363 5879.196
-18.5765 4.448622