(a) The estimated regression line is: Crude_Production = 50.94 + 0.61 Energy_Con
ID: 374113 • Letter: #
Question
(a) The estimated regression line is:
Crude_Production = 50.94 + 0.61 Energy_Consumption + 0.03 Nuclear_Generation - 0.75 Coal_production - 0.66 Gas_Production - 1.5 Mile_Rate
(b) We look at the sign of the independent coefficients to know the relationship between the regressors and dependent variable.
Energy_Consumption and Nuclear_Generation have a direct relationship.
While Coal_production, Gas_Production and Mile_Rate have inverse relationship.
(c) Intercept gives us the production of crude oil in absence of any variables. Which in this case would be 50.94 Million barrels per day. Slopes of the regressors tell us how much the production of crude oil will change if we increase the variable marginally by 1 unit.
Energy_Consumption - Increase the production by 0.61 million barrels per day
Nuclear_Generation - Increase the production by 0.03 million barrels per day
Coal_production - Decrease the production by 0.75 million barrels per day
Gas_Production - Decrease the production by 0.66 million barrels per day
Mile_Rate - Decrease the production by 1.5 million barrels per day
(d) An r-squared value of 0.89 tells us that the independent variables account for 89% of the variance(information) of the dependent variable. This shows that the independent variables have some predective power abot the dependent variable.
(e)Variables like current price of crude can give us some more information about crude production.
(f)I'm unsure about the second observation as it seems like an outlier. regressions work well when the test data point is within the bounds of the data on which we have predicted the regression line.
Explanation / Answer
Insert Design Layout References MailingsReview View , | | A A, A- :-| 14 Times New Ro QUANTITATIVE METHODS FOR MGMT DECISION MULTIPLE REGRESSION ANALYSIS ASSIGNMENT- EXAMPLE #2: A rescarcher desires to develop a multiple regression to predict the world production of crude oil. The researcher realizes that much of the world crude oil market is driven by variables related to usage and production in the United States. She decides to use as predictors the following five independent variables: 1. U.S. energy consumption. 2. Gross U.S. nuclear electricity generation. 3. US. coal production. 4. Total U.S. dry gas production (natural gas), and 5. Fuel rate of U.S. owned automobiles. U.S. Total US U.S. Coal Dry Gas Fuel World U.S. Nuelear Crude Oil U.S. Energy Electricity Production Consumption Gross Generation Production Production Rate (Quadrillion Trillion For (Mil. Barrels (Quadrillion (Billion Killowatt Per day) BTUs per Y) Hours) 55.7 52.8 57.3 BTUs) Cubie Ft) Auto 74.3 72.5 70.5 87.8 124.3 1823 201.8 264.2 292.4 270.6 265.4 288.5 298.6 313.6 343.8 402.7 434.1 479.5 554.1 557.0 603.4 13.30 13.42 13.52 13.53 13.80 14.04 14.41 15.46 15.94 16.65 17.14 17.83 18.20 18.27 19.20 19.87 20.31 20.92 14.1 1s.o 15.7 15.8 14.9 7.5 18.6 18.4 8.6 20.7 19.2 19.1 19.2 19.1 19.7 19.4 19.2 17.8 16.1 17.5 16.5 59.6 78.9 76.0 55.8 53.0 53.6 74.1 73.9 19.7 55.9 19.5 20.1 20.7 16.6 80.2 81.3 81.3 59.8 17.3 17.8 22.4
Related Questions
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.