# isom 201 chapter 4

There are only one question in this homework. Have to finish in excel sheet. Homework 2 chapter 4

Instruction:

Generate three excel sheet and name them Model 1, Model 2, and response sheet

Solve the following problem in the excel and answer all the section in response sheet and highlight in model 1, model 2 sheet if necessary

Specify each section by the related letter in excel cell you are responding

Use only 2 decimal digit in responses

Save the file with your name and Submit only one file (10 Points)

A sample of nine public universities and nine private universities was taken. The total cost for the year (including room and board) and the median SAT score (maximum total is 2400) at each school were recorded. It was felt that schools with higher median SAT scores would have a better reputation and would charge more tuition as a result of that. The data are in the attached excel file. Run the regression one time with Total cost as dependent variable and Median SAT as independent variable and name it Regression model 1 and Run regression for the second time with Total cost as dependent variable and Median SAT and Dummy variable as independent variables and name it Regression model 2.

a)Write the predicted regression equation and highlight it for both models

b)High light the r2 and explain it for both models

c) Which model is a better model based on Adjusted R2? Why Adjusted R2 and not R2 ?

d)Highlight Significance F and explain it for both models

e)Highlight the p-value and discuss if independent variables are significant or not for both models

f)Discuss the sign of the co-efficient for both models and compare them.

g)Generate Residual vs fitted value for the regression model 1 and interpret it

h) Generate Normal Probability Plot for regression model 1 and interpret it

Hint: Dummy variable gets the value of 0 for public universities and1 for private universities.

 Total Cost (\$) Median SAT Dummy University 1 21700 1990 Public University 2 15600 1620 Public University 3 16900 1810 Public University 4 15400 1540 Public University 5 23100 1540 Public University 6 21400 1600 Public University 7 16500 1560 Public University 8 23500 1890 Public University 9 20200 1620 Public University 10 30400 1630 Private University 11 41500 1840 Private University 12 36100 1980 Private University 13 42100 1930 Private University 14 27100 2130 Private University 15 34800 2010 Private University 16 32100 1590 Private University 17 31800 1720 Private University 18 32100 1770 Private
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