ECO578_SummerII_2017

Run a regression using the given data. (With Profit as the dependent variable and Dealership Store size as the independent variable)

2. Compare the results of question (1) with another regression equation obtained by regressing the Profit on the variables : Sedan Sales and Suv sales.

3. Which of the models do you prefer? Why?

4. Interpret your results for (1) and (2).

5. In writing your paper, you should start by indicating the objectives of the study and value addition thereof from the business context. Also, discuss the methodology and conclusions

You can submit your work either as a PDF or WORD File (Make sure Only ONE file is
submitted) You can attach your Excel file as your appendix (only ONE Excel file is allowed)
*Only one Word or PDF file and one Excel file should be submitted in the drop box Due: Thursday, August 3, 2017 by 06:00 p.m (Central Time) Profits
Use the given Sample data for profits made by Car Dealers and follow the instructions below: Instructions
1. Run a regression using the given data. (With Profit as the dependent variable and Dealership
Store size as the independent variable)
2. Compare the results of question (1) with another regression equation obtained by regressing the
Profit on the variables : Sedan Sales and Suv sales.
3. Which of the models do you prefer? Why?
4. Interpret your results for (1) and (2).
5. In writing your paper, you should start by indicating the objectives of the study and value
addition thereof from the business context. Also, discuss the methodology and conclusions.
**Range: 5 pages + Excel printout results**
**You can use EXCEL or any other software**
** You need to include your printout in your submissions** Paper Format
The layout and format of the paper should include the following sections:
Title page, Abstract, Introduction, Methodology, Empirical-Results, and Discussion,
Conclusions.
a) Abstract: is a very concise summary of the paper.
b) Introduction: Tells the reader about the topic. Specifically, it should start with ‘the purpose of
this paper is to examine….’ ‘What the issue is’, ‘what is known about it’, and the specific focus? Put
1 a business context to it - write the value added by your work or what businesses can gain from
the knowledge of the determinants of incomes.
c) Methodology: You should be able to explain what method you are using for your work. For
example, you can start with telling the reader that the ‘ordinary least squares method (OLS) was
used to obtain estimated coefficients...’ (Then write more). You should be able to write the
equation from the Excel result. We expect to see you…
1. Using the excel result to generate the equation.
2. Find the standard error of each variable.
3. Find the t-stat of each variable.
4. Find the p-value of each variable.
5. Find the F-value of the equations
EXAMPLE:
? = 1.24 + 1.71X1 - 0.83X2 - 2.12X3
(6.79) (1.43) (0.22) (0.85) T-stat [0.18] [1.20] [3.78] [2.48] P-value 0.857 0.247 0.002 0.025 d) Empirical-Results: Should tell what was found from the computed data. Using Chapter 10 and 11 for
helping you interpret your result. For instance, you should interpret the Coefficient of Determination ( ),
F-test, t-test, p-value and etc. In addition, your result should use the hypothesis equation.
e) Discussion: Describes what your findings mean in the light of the information presented in the
introduction. It is the interpretive segment of the paper and loops back to answer the issues raised in the
introduction. Remember to discuss questions 2 and 3.
f) Conclusion: What conclusion would you draw based on your study.
**Remember that the results section should include hypothesis testing for a t-test about each slope
coefficient and an F-test for the overall regression model.
EXAMPLE:
For the t-test, it is written like this:
Note: You have to decide whether to use one-tail or two-tail test You need to follow chapter 9 materials and declare your alternative hypothesis in each case
very well
F-test: Note: mention what ? is used in your hypothesis testing. 2 Data Sample Data for Profits of Car Dealers
Dealer Number Sedan Sales Suv Sales 1
2
3
4
5
6
7
8
9
10 366
156
227
210
121
323
505
234
338
244 42
118
100
91
112
92
53
68
37
110 Dealership Size (In
thousands sq ft)
42
26
32
19
34
55
67
14
48
38 Profit (In thousands)
480
360
400
220
380
640
840
160
520
560 How to Submit Your Journal