Linear Regression

1142 Words May 4th, 2011 5 Pages
Linear-Regression Analysis
Introduction
Whitner Autoplex located in Raytown, Missouri, is one of the AutoUSA dealerships. Whitner Autoplex includes Pontiac, GMC, and Buick franchises as well as a BMW store. Using data found on the AutoUSA website, Team D will use Linear Regression Analysis to determine whether the purchase price of a vehicle purchased from Whitner Autoplex increases as the age of the consumer purchasing the vehicle increases. The data set provided information about the purchasing price of 80 domestic and imported automobiles at Whitner Autoplex as well as the age of the consumers purchasing the vehicles. Team D selected the first 30 of the sampled domestic vehicles to use for this test. The business research question
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The results of the Linear Regression analysis utilized by team D found conclusively that consumer age does not affect purchase price at Whitner Autoplex. This test is accurate even though the sample sizes are equal because both sample sizes are significant. The results of the Linear Regression Analysis completed above allow us to reject the null hypothesis and state conclusively that age and purchase price are in no way dependent on one another. Based on the scatter plot and Excel’s fitted linear regression, displayed above, the linear model seems justified. The low R2 of 0.359 says that Age “explains” only 36 percent of the variation in Purchase Price.
Conclusion
Throughout the last four weeks in Research and Evaluation II, Team D has run various hypothesis tests on the Whitner Autoplex data set provided by University of Phoenix. The data set provided information about the purchasing price of 88 domestic and imported cars as well as age of the consumers. In week two, Team D conducted a one-sample hypothesis test comparing the national average purchasing price with that of the Whitner Autoplex prices and answering the research question: Does the average price of automobiles sold at Whitner Autoplex dealership exceed the national average sale price of similar automobiles? Once the test was complete, Team D accepted the null hypothesis of: Ho: u < $23,000. In week 3, Team D conducted a two-sample hypothesis test in which we answered the research