Professional Documents
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Group: 16
Variables
Dependent Variable
Investments ()
Independent Variables
Government Investments (X1) Other Investments (X2)
Correlations (5 Years)
Investments Government Other Investments Investments
Pearson Investments Correlation Government Investments Other Investments 1.000 0.953 0.913 0.953 1.000 0.747 0.913 0.747 1.000
Investment
Government Investment Other Investment
Government Investments
Investments Other Investments
Other Investments
Investments Government Investments
Model Summarya
Model 1 R 1.000a R Square 1.000 Adjusted R Square 1.000 Std. Error of the Estimate 0.671
R
Measures the strength of the linear relationship between variables. Here R is 1.00. Direct or positive association between the variables.
R Square
Here R square is 1.00 (strong association). We can say that independent variables can influence the dependent variable by 100%.
Global Test
Critical value of F is 19 (From appendix B.4)
H0: 1= 2= 0
ANOVAb
Model 1 Regression Sum of Squares 7.013E7 df 2 Mean Square 3.506E7 F Sig. 0.000a
7.795E7
Residual 0.900 2 0.450 Total 7.013E7 4 a. Predictors: (Constant), 5 years other investments, 5 years government investments b. Dependent Variable: 5 years investments
H0: 1= 0
H1:1 0
Decision Rule
Reject H0 if -4.303 > t > 4.303.
Government Investments
Critical value of t
Model
(Constant)
Government Investments Other Investments
Coefficientsa (5 Years) Unstandardized Standardized Coefficients Coefficients B Std. Error Beta 1.131 1.053 1.000 1.000 0.000 0.000
Sig.
0.395
0.000 0.000
Multicollinerity
Coefficient Correlationsa(5 Years) Model Other Government Investments Investments 1 Correlati Other Investments 1.000 -0.747 ons Government Investments -0.747 1.000 a. Dependent Variable: 5 years investments
General Rule: Correlation between two independent variables within 0.70 (no problem of using the independent variables).
There is multicollinearity
Chance of providing incorrect results in the hypothesis tests for individual independent variables.
Variables:
Independent Variables
Operating Income (X1) Operating Expense(X2)
Dependent variables
Regression Equation:
= a+ b 1 X 1 + b 2 X 2
b1= 0.524 EAT will increase by 0.524 Million, regardless of the operating expense.
b2= -0.659 EAT will decrease by 0.659 Million, regardless of the operating income.
EAT is 398.126 Million when operating income and operating expense is zero
Correlation:
EAT
Pearson Operating Correlation Income Operating Expense EAT 1.000 .966 .700 Operating Income .966 1.000 .848 Operating Expense .700 .848 1.000
Positive and strong correlation with Operating Income and Positive but less strong correlation with Operating Expense.
Operating Income
Positive and strong correlation with EAT and Operating Expense
Positive but less strong correlation with EAT Strong positive correlation with Operating Income.
EAT
Operating Expense
Model Summary:
Model R Adjusted Std. Error of the R Square R Square Estimate
.993a
.985
.971
215.693
R is 0.993 which is quiet near to 1. Direct or positive association between the variables
Operating income and operating expense can explain 98.5% variation in dependent variable EAT
68% of the residuals will be within 215.693 95% of the residuals will be within 431.386 and 99% of the residuals will be within 647.079
R Square
Global Test:
Critical value: Critical value of F is 19. Decision Rule: Reject H 0 if (F c > 19), calculated value of F is greater than 19.
ANOVA Model 1 Residual
Sum of Squares
93046.560
df 2 2
Sig.
Regression 6251884.240
Total
6344930.800
H0 : 1= 0
H0 : 2= 0
Critical value: Critical value of t is 4.303 Decision Rule: Reject H 0 if t c < -4.303 or t c > 4.303 Unstandardized Coefficients Standardized Coefficients
B
398.126 .524 -.659
t 1.277
Beta
1.330 -.428
8.221 -2.647
Multicollinearity
Model
Correlations Operating Expense 1.000 -.848 Operating Income -.848 1.000
Operating Expense
Operating Income
General Rule
No problem with using variable having correlation between 0.70 and +.70
Test Result
Multicollinearity Exist
Variables
Independent variable Total Loans and advances Dependent Variable()
Regression Equation:
= a+ b 1 X 1 + b 2 X 2
Total loans and advances= Constant+b 1 cash credits+ b 2 Bills Purchased = -205.375+ 1.042 X 1 +0.039 X 2 Loans
Intercept a = -205.375 Total loans and advances is tk.205.375 when loans, cash credits and bills purchased is zero.
b1= 1.042 Total loans and advances would increase per million by 1.042, regardless of the bills purchased
b2= 0.039 Total loans and advances would increase per 0.039, regardless of the loans, cash credits
Correlations
Total loans Loans Cash and advances credits Bills purchased -.521 -.530
1.000 1.000
1.000 1.000
Bills purchased
Total loans
-.521
Loans cash credits
There is a positive and strong relationship with total loans and advances. There is a positive but less strong relationship with bills purchased
-.530
1.000
Bills purchased
There is a positive and strong relationship with loans, cash credits and negative relationship with bills purchased.
There is a negative relationship with both total loans advances and loans, cash credits.
Model Summary
Model 1 R 1.000a R Square 1.000 Adjusted R Square 1.000 Std. Error of the Estimate 385.10153
R square
Here R square is 1.00 which indicates that there are strong association between the variables
Here R is 01.00. It indicates that there is a direct or positive association between the variables.
Hypothesis: H 0 : 1 = 2 = 0
Critical value : of F is 19. Decision Rule: Reject H 0 if (F c > 19), calculated value of F is greater than 19.
ANOVA
Model Sum of Squares df Mean Square F Sig.
1 Regression
2.693E9
1.346E9 9.078E3
.000a
Residual
Total
296606.375
2.693E9
2
4
148303.187
H 0: 2= 0
H 1: 2 0
Critical value: Critical value of t is 4.303 Decision Rule: Reject H 0 if t c < -4.303 or t c > 4.303
Sig.
-.316
.782
1.042
.039
.009
.028
1.006
.012
115.008
1.377
.000
.302
Multicollinearity
Model Bills purchased Correlations Loans Cash credits Bills Loans and purchased cash credits 1.000 .530 .530 1.000
General Rule
No problem with using variable having correlation between 0.70 and +.70
Test Result
Correlation between Bills purchased and loans Cash credits is .530. Multicollinearity does not exist.
Variables
Dependent variables: Dependent variables: Total income, represented by Independent variables: Other income, represented by X1 Commission, exchange &brokerage, represented by X2 Investment income, represented by X3 come, represented by Independent variables: Other income, represented by X1
Regression Equation
= a+ b1 X1+ b2 X2+ b3 X3 Total income= b1 Investment income + b2 Commission, exchange & brokerage+ b3 other income = -152.335 -3.238 X1 +6.219 X2+4.028 X3
Correlation:
Total Investment Commission Other Income Income Exchange& Income Brokerage Total income Investment income 1.000 0.588 0.840 -0.243
0.588
0.840 -0.243
1.000
0.928 -0.801
0.928
1.000 -0.654
-0.801
-0.654 1.000
Model Summary
Model Summary Model
1
R
0.988a
R Square
0.975
Adjusted R Square
0.901
a. Predictors: (Constant), Other income, commission, exchange & brokerage, Investment income
Global Test
H0: 1= 2= 3= 0 H1: Not all the is are 0 Critical value: Critical value of F is 216. Decision Rule: Reject H0 if (Fc > 216), calculated value of F is greater than 216.
ANOVA df
3 1 4
F 13.171
Sig. 0.199a
B 1 (Constant)
Investment income Commission, exchange & brokerage Other income
-152.335
-3.238
-0.046
-1.205 -2.074
0.971
0.286
6.219
1.402
2.042
4.436
0.141
4.028
9.028
0.128
0.446
0.733
Multicollinearity
Coefficient Correlations Model Other income Commission, Correlations exchange& brokerage Other Income 1.000 -0.399 0.687 81.505 -5.044 9.686 Commissio n Investment Income Exchange & Brokerage -0.399 0.687 1.000 -0.892 -5.044 1.965 -1.953 -0.892 1.000 9.686 -1.953 2.438
Investment income
Other income Covariance Commission, exchange& brokerage Investment income
Variables
Independent variables:
PEARSON CORRELATION
Total Deposits
Current Deposits
Fixed Deposits
1.000
0.945
0.954
0.945 0.954
1.000 0.916
0.916 1.000
0.975 0.903
0.980
0.975
0.903
1.000
OPINION
In case of total deposits there is a positive and strong relationship with current, savings bank and fixed deposits
In case of current deposits there is a positive and strong relationship with current, savings bank and fixed deposits In case of fixed deposits there is a positive and strong relationship with current, savings bank and fixed deposits In case of savings deposits there is a positive and strong relationship with current, savings bank and fixed deposits
MODEL SUMMARY
Model R R Square Adjusted R Square 0.992 Std. Error of the Estimate 1894.995
0.999a
0.998
Sum of Squares
1.827E9
df
3
Mean Square
6.089E8
F
169.553
Sig.
0.56a
Residual Total
3591005.111 1.830E9
1 4
3591005.111
Decision Rule: Reject H 0 if (F c > 216), calculated value of F is greater than 216.
Fixed Deposit
0.900
0.211
0.474
4.272
0.146
New Equation:
=a
Multicollinerity:
Coefficient Correlations
Model Fixed deposit Savings bank deposit Current deposit
Correlations
Fixed deposit
Savings bank deposit Current deposit
1.000
-0.122 -0.366
-0.122
1.000 -0.855
-0.366
-0.855 1.000
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