# Regression- Statistics

Use the given Sample data for profits made by super markets and follow the instructions below:  Instructions  1. Run a regression using the given data. (With Profit as the dependent variable and Store size as the independent variable)

2. Compare the results of question (1) with another regression equation obtained by regressing the Profit on the variables : Food Sales and Non food sales.

3. Which of the models do you prefer? Why?

4. Interpret your results for (1) and (2).

5. In writing your paper, you should start by indicating the objectives of the study  and  value addition thereof from the business context. Also, discuss the methodology and conclusions.

**Range:  5 pages + Excel printout results** **You can use EXCEL or any other software** ** You need to include your printout in your submissions**

 Paper Format

The layout and format of the paper should include the following sections:

Title page, Abstract, Introduction, Methodology, Empirical-Results, and Discussion, Conclusions.

a) Abstract: is a very concise summary of the paper.

b) Introduction:  Tells the reader about the topic. Specifically, it should start with ‘the purpose of this paper is to examine….’ ‘What the issue is’, ‘what is known about it’, and the specific focus? Put

a business context to it – write the value added by your work or what businesses can gain from the knowledge of the determinants of incomes.

c) Methodology:  You should be able to explain what method you are using for your work. For example, you can start with telling the reader that the ‘ordinary least squares method (OLS) was used to obtain estimated coefficients…’ (Then write more).  You should be able to write the equation from the Excel result. We expect to see you…

1. Using the excel result to generate the equation.   2. Find the standard error of each variable.   3. Find the t-stat of each variable.   4. Find the p-value of each variable.   5. Find the F-value of the equations

EXAMPLE:

Ŷ =          1.24  +   1.71X1 –   0.83X2  –  2.12X3      (6.79) (1.43) (0.22) (0.85) T-stat [0.18] [1.20] [3.78] [2.48] P-value 0.857 0.247 0.002 0.025 d) Empirical-Results: Should tell what was found from the computed data. Using Chapter 10 and 11 for helping you interpret your result. For instance, you should interpret the Coefficient of Determination (  ), F-test, t-test, p-value and etc. In addition, your result should use the hypothesis equation.

e) Discussion: Describes what your findings mean in the light of the information presented in the introduction. It is the interpretive segment of the paper and loops back to answer the issues raised in the introduction. Remember to discuss questions 2 and 3.

f)Conclusion: What conclusion would you draw based on your study.