// Numbas version: finer_feedback_settings {"name": "Multiple regression - interpretation of software analysis", "extensions": [], "custom_part_types": [], "resources": [], "navigation": {"allowregen": true, "showfrontpage": false, "preventleave": false, "typeendtoleave": false}, "question_groups": [{"pickingStrategy": "all-ordered", "questions": [{"name": "Multiple regression - interpretation of software analysis", "tags": [], "metadata": {"description": "

To assess interpretation of a statistical software output and use corresponding equation to make prediction.

", "licence": "Creative Commons Attribution-ShareAlike 4.0 International"}, "statement": "

The management at {thisrest} adopts the following model to predict monthly profit $y$ (in 1000s of £) at their {place} branch.

\n

\\[\\hat{y} = \\beta_0+ \\beta_1 x_1 + \\beta_2 x_2 + \\beta_3 x_3\\]

\n

where 

\n

$x_1=\\;$number of competitors within one km.

\n

$x_2=\\;$population within one km (in 1000s).

\n

$x_3=\\;$ 1 if {cond}, 0 otherwise.

", "advice": "

a) $x_3$ is the indicator variable.

\n

\n

b)

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(i) The values of A, B, C and D are given by:

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A = 3.887 x SE Coef (A) = 3.887 x {sea} = {ansa}.

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B = Coef (B)/-2.64 = {cb}/-2.64 = {ansb}.

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C = 3.82 x SE Coef (C) = 3.82 x {se} = {ansc}.

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D = 2.53 x SE Coef (D) = 2.53 x {sed} = {ansd}.

\n

ii) The fitted regression equation is:

\n

\\[\\hat{y}=\\var{ansa}-\\var{abs(cb)}x_1+\\var{ansc}x_2+\\var{ansd}x_3+\\epsilon\\]

\n

\n

c)

\n

Using the above fitted model where $x_1=\\var{thatmany}$ and $x_2= \\frac{\\var{thismany}}{1000}=\\var{thismany/1000}$ and since $x_3=\\var{q}$ as the restaurant {hascond} we find :

\n

\\[\\hat{y}=\\var{ansa}-\\var{abs(cb)}\\times \\var{thatmany}+\\var{ansc}\\times \\var{thismany/1000}+\\var{ansd}\\times \\var{q}=\\var{pred}\\]

\n

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Which of these variables is an indicator variable?

\n

[[0]]

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$x_1$

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$x_2$

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$x_3$

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Based on a recent survey of some of the restaurants in the North-East, the following (edited) software output was obtained:

\n

Regression Analysis: $y$ versus $x_1,\\;x_2,\\;x_3$

\n

The regression equation is: y = ********

\n

\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n
\n

Predictor

\n
\n

Coef

\n
\n

SE Coef

\n
\n

T

\n
\n

P

\n
\n

Constant

\n
\n

$A$

\n
\n

{sea}

\n
\n

3.89

\n
\n

0.002

\n
\n

$x_1$

\n
\n

{cb}

\n
\n

$B$

\n
\n

-2.64

\n
\n

0.021

\n
\n

$x_2$

\n
\n

$C$

\n
\n

{se}

\n
\n

3.82

\n
\n

0.002

\n
\n

$x_3$

\n
\n

$D$

\n
\n

{sed}

\n
\n

2.53

\n
\n

0.024

\n
\n

s={sval}       R-sq= 92.1%      R-Sq(adj)=93.9%

\n

(i) Find the values of $A,\\;B,\\;C$ and $D$:

\n

$A=\\;$[[0]],   $B=\\;$[[1]]

\n

$C=\\;$[[2]],   $D=\\;$[[3]]

\n

(ii) Considering the table above and the general model ($\\hat{y} = \\beta_0+ \\beta_1 x_1 + \\beta_2 x_2 + \\beta_3 x_3$), fill in the gaps below to complete the regression equation:

\n

$\\hat{y}=\\;$[[4]]-$\\var{abs(cb)}x_1$+[[5]]$x_2$+[[6]]$x_3$

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"alwaysreplace", "nextParts": [], "suggestGoingBack": false, "adaptiveMarkingPenalty": "0", "exploreObjective": null, "prompt": "

Predict the profit for a restaurant with {thatmany} competitors, a population of {thismany/1000} thousands within 1 km and that {hascond}:

\n

$\\hat{y}=\\;$[[0]]k£

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