MGMT2263 Tutorial Sheet 6 Solutions

Question 1

Variables	Adj. R^2	ANOVA p-value	t-test: are all variables significant? (yes or no)	Any multicollinearity? (yes or no)
All variables	81.23%	0.021	No	Yes
Home size, garage	83.04%	0.005	No	No
Home size	84.9%	0.001	Yes	No

The model with only home size is the best since:

• It has the highest adjusted r²
• It has the lowest ANOVA p-value
• All its variables are significant
• It has no presence of multicollinearity

Question 2:

Ho: Sale amount does not depend on counter

Ha: Sale amount does depend on counter

Reject Ho if chi-square > 9.4877

Here is the crosstab of expected values:

36.6667	36.6667	36.6667
35.6667	35.6667	35.6667
27.6667	27.6667	27.6667

chi-square = 3.503 + 0.076 + 2.548 + 0.078 + 0.153 + 0.012 + 3.378 + 0.016 + 3.859 = 13.623

Reject Ho; Conclude the sales amount depends on the counter.

Cramer’s V = sqrt(13.623/(2(300)) = 0.1507 = 15.07%