Correlation, simple linear, and Multiple Regression Analysis
Multiple regression analysis is widely used in business research in order to forecast and predict purposes. It is also used to determine what independent variables have an influence on dependent variables, such as sales.
Sales can be attributed to quality, customer service, and location. In multiple regression analysis, we can determine which independent variable contributes the most to sales; it could be quality or customer service or location.
Now, consider the following scenario. You have been assigned the task of creating a multiple regression equation of at least three variables that explains Microsoft’s annual sales.
Use a time series of data of at least 10 years. You can search for this data using the Internet.
Before running the regression analysis , predict what sign each variable will be and explain why you made that prediction.
Run three simple linear regressions by considering one independent variable at a time
After running each of the three linear regressions, interpret the regression.
Does the regression fit the data well?
Run a multiple regression using all three independent variables.
Interpret the multiple regression.
Does the regression fit the data well?
Does each predictor play a significant role in explaining the significance of the regression?
Are some predictors not useful?
If so, did you consider removing those and rerunning the regression?
Are the predictors related too significantly to one another? What is the coefficient of correlation “r”? Do you think this “r” value suggests a strong correlation among the predictors ( the independent variables?
Submit your answers in a two- to three-page Word document.
On a separate page, cite all sources using the APA guidelines with in-text citations and no wiki websites.
Assignment 2 Grading Criteria
Maximum Points
Analyzed and predicted what sign each variable will be before running the regression, and explained why they made that prediction.
10
Interpreted the simple linear and multiple regression after running the regression.
10
Analyzed and explained if the regression fits the data well.
5
Analyzed and explained if each predictor plays a significant role in explaining the significance of the multiple regression.5
Analyzed and explained if some predictors are not useful.
5
Considered removing the predictors that are not useful and rerunning the regression.
5
Analyzed and explained if the predictors are related too significantly to one another (correlation).
5
Used correct spelling, grammar, and professional vocabulary. Cited all sources using the APA guidelines.
5
Total
50
.
Correlation, simple linear, and Multiple Regression AnalysisMu.docx
1. Correlation, simple linear, and Multiple Regression Analysis
Multiple regression analysis is widely used in business research
in order to forecast and predict purposes. It is also used to
determine what independent variables have an influence on
dependent variables, such as sales.
Sales can be attributed to quality, customer service, and
location. In multiple regression analysis, we can determine
which independent variable contributes the most to sales; it
could be quality or customer service or location.
Now, consider the following scenario. You have been assigned
the task of creating a multiple regression equation of at least
three variables that explains Microsoft’s annual sales.
Use a time series of data of at least 10 years. You can search for
this data using the Internet.
Before running the regression analysis , predict what sign each
variable will be and explain why you made that prediction.
Run three simple linear regressions by considering one
independent variable at a time
After running each of the three linear regressions, interpret the
regression.
Does the regression fit the data well?
Run a multiple regression using all three independent variables.
Interpret the multiple regression.
Does the regression fit the data well?
Does each predictor play a significant role in explaining the
significance of the regression?
Are some predictors not useful?
If so, did you consider removing those and rerunning the
regression?
2. Are the predictors related too significantly to one another?
What is the coefficient of correlation “r”? Do you think this “r”
value suggests a strong correlation among the predictors ( the
independent variables?
Submit your answers in a two- to three-page Word document.
On a separate page, cite all sources using the APA guidelines
with in-text citations and no wiki websites.
Assignment 2 Grading Criteria
Maximum Points
Analyzed and predicted what sign each variable will be before
running the regression, and explained why they made that
prediction.
10
Interpreted the simple linear and multiple regression after
running the regression.
10
Analyzed and explained if the regression fits the data well.
5
Analyzed and explained if each predictor plays a significant
role in explaining the significance of the multiple regression.5
Analyzed and explained if some predictors are not useful.
5
Considered removing the predictors that are not useful and
rerunning the regression.
5
Analyzed and explained if the predictors are related too
significantly to one another (correlation).
5
Used correct spelling, grammar, and professional vocabulary.
