Question 3
Regress DollarVal onto RecencyTrain, FrequencyTrain, and DollarTrain. What is the R squared for this model?
Ans: R-squared: 0.304, Adjusted R-squared: 0.303
Please interpret the coefficients on RecencyTrain, FrequencyTrain, and DollarTrain.
RecencyTrain: One unit of change in RecencyTrain, causes a decrease of |-0.056| in the DollarVal, holding all
[Type here]
, 10/15/2018 radiant-report-2018-02-07.html
FrequencyTrain: One unit of change in FrequencyTrain, causes an increase of |12.066| in the DollarVal,
holding all other variables constant
DollarTrain: One unit of change in DollarTrain, causes an increase of |0.008| in the DollarVal, holding all
other variables constant
Linear regression (OLS)
Data : CDSalesProcessed
Response variable : DollarVal
Explanatory variables: FrequencyTrain, DollarTrain, RecencyTrain
Null hyp.: the effect of x on DollarVal is zero
Alt. hyp.: the effect of x on DollarVal is not zero
Question 4
Please use the model in Q3. Please predict DollarVal for a customer that has RecencyTrain=100,
FrequencyTrain and DollarTrain at the sample mean.
FrequencyTrain mean = 2.253
DollarTrain mean = 81.507
Ans: 29.086
This study source was downloaded by 100000830604181 from CourseHero.com on 10-21-2021 05:32:22 GMT -05:00
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