ADVANCED MARKETING RESEARCH

Model 1:
Yt = a1 + a2 X2t + a3 X3t + a4 X4t + a5 X5t + ut
here Yt is predicted value of sales of roses.

Model 2:
InYt = b1 + b2 InX2t + b3 InX3t + b4 InX4t + b5 InX5t + ut
A. Estimate the parameters of the linear model and interpret
the results.
Y = quantity of roses sold, dozens
X2 = average wholesale price of roses, $/dozen
X3 = average wholesale price of carnations, $/dozen
X4 = average weekly family disposable income, $/week
X5 = the trend variable taking values of 1,2, and so on, for the entire period.
Here Y is dependent variable, a1, a2,a3,a4, a5 and b1,b2,b3,b4 b5 are coefficients of
different-different independent variables.
And we have to find the effect of independent variable on dependent variable (sales of
roses) so here we use regression model. Regression analysis is a mathematical model that
can be used to predict one variable by another.
Spss analysis of regression function is as follows.
Model Summary

Model R R Square Adjusted R Square Std. Error of the Estimate

Predictors: (Constant), disposable_income
1
.882a .778 .722 1076.29087
price_carnation, price_rose

ANOVA

Model Sum of Squares Df Mean Square F Sig.

1 Regression 4.870E7 3 1.623E7 14.012 .000a

Residual 1.390E7 12 1158402.031

Total 6.260E7 15

a. Predictors: (Constant), disposable_income, price_carnation, price_roses

a. Dependent Variable: roses_demand

Analysis:
Here from model summary we can analyze that 77.8% of sales of roses explained by all independent
variable. Coefficient of correlation between dependent and exploratory variables is also very high
ie .882.
Adjusted R2 should be defined where there would be more than one independent variable Adjusted R2
shows the changes in R2 when we add an another independent variable in exploratory variables. Here it
is lower than coefficient of determination (R2) which is 72.2, which shows there is some problem in data
and there can be multicollinearity problem between independent variable.
Annova is significant since significant level is less than .05, which shows this model has at least one
variable which is good.