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HYPOTHESIS TESTING
AND DATA ANALYSIS
Prof. Yogesh Funde
Types of Analysis
2
Factor analysis
Discriminant Analysis
The Basics
3
Measures of Association
EXHIBIT 23.1
Bivariate Analysis
Common Procedures for
Testing Association
Correlation coefficient
Covariance
i 1
Xi X Yi Y
n
i 1
i 1
Simple Correlation
Coefficient
Ranges from +1 to -1
Perfect
Correlation Analysis of
Number of Hours
Worked
in Manufacturing
Industries
with Unemployment
Rate
Coefficient of Determination
10
Total Variance
Correlation Matrix
11
Correlation matrix
EXHIBIT 23.4
12
Y
130
120
110
100
Y a X
90
80
Y
X
80
90
100
110
120
130
140
150
160
170
Regression Analysis
14
EXHIBIT 23.5
15
17
EXHIBIT 23.6
18
EXHIBIT 23.7
19
130
120
110
Deviation explained
by the regression
100
90
80
80
90
100
110
120
130
140
150
160
170
180
190
X
OLS
The equation means that the predicted value for any value
of X (Xi) is determined as a function of the estimated slope
coefficient, plus the estimated intercept coefficient + some
error.
25
ANOVA Table:
2325
26
R2
3,398.49
R
.875
3,882.40
2
The
EXHIBIT 23.8
28
Regression Output
29
Regression Output
30
The regression coefficient (slope) indicates that for every building permit
issued, sales increase 0.546. Moreover, the standardized regression
coefficient of 0.936 would allow the researcher to compare the
explanatory power of building permits versus some other potential
independent variable. For simple regression,
equals r.