Parts a through d 11. (15 pts) Researchers collected data on a cross-section of
ID: 3315042 • Letter: P
Question
Parts a through d
11. (15 pts) Researchers collected data on a cross-section of personal computers from 1993 to 1995. We want to predict the price (in US dollars) based on the speed (in Mhz), ram (in MB), screen size (in inches), and whether it has a cd drive and/or multimedia kit included (both binary yes/no variables). Consider the following model: speed + ram + screen + cd + multi, data-computers) mod ltI) 0.337 ##(Intercept) 85.4823 ## speed ## ram ## screen ## cdyes ## multiyes 88.9553 0.961 0.2722 16.396Explanation / Answer
a) From the graph the conditions for Multiple regression are not holding true because the Residual variances are not randomly ditributed and they are following the pattern.
Also, from the QQ plot residual are not normally distribnuted.
Hence conditions are not meeting.
b) From the output window it is clear that first three variables after intercept are statistically significant .
Thos are Ram, Screen, CDyes.
c) It interprets that, The CD yes is affecting the prices in reverse direction. That is CD yes and prices of the computer are inversally proportional.
4) R square is 0.4487 that implies the thing, The model is able to explain 44 percent of the variation of the predictors and respnce.