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Case Study: Application of Regression Analysis
Case Study: Application of Regression Analysis
Suppose that you rent a snow-cone cart at a local amusement park.
You create a table showing total snow cones sold for each day of
last summer. In Figure 14.15 , column E shows the total snow cones
sold by day. As you can see, the sales rise and fall sharply from
day to day.
Figure 14.15.
Figure 14.15. The results of the
The results of the LINEST
function in G4:J8 are seemingly
meaningless.
LINEST function in G4:J8 are seemingly
meaningless.
The previous manager of the cart had noticed certain trends in the
data. Sales were better on the weekends than on weekdays. Sales were
horrible when it rained. Sales improved as the weather became hotter
in July and August.
Columns B:D in Figure 14.15 contain data related to temperature, week-
ends, and rain. Note that in column C, the weekend data is binary
data either 0 or 1. In column D, the manager could have kept inform-
ation about the amount of rainfall each day but instead kept this as
binary data as well. If the day was predominantly rainy, the manager
recorded a 1 to indicate a rainout. If the day had just a spot of rain,
the manager recorded it as a nonrainy day.
To perform regression on this data, follow these steps:
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