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Ford Mustang Case 7

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Submitted By LDJ524
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Ford Mustang Case 7
Applied Managerial Statistics

To determine the factors that affect Selling Price of Ford Mustangs, we need to select the independent factors or variables to test the hypothesis to see if these factors do have any affect on the selling price of Ford Mustangs cars. In this case I have selected nine Independent variables that we have used to study the relationship with selling price are (1) Whether the car is a convertible or not convertible (2) Transmission Type (3) Presence or absence of air conditioning (4) GT Model or not (5) Private owner or dealer owner (6) Age of car (7) Mileage (8) # of cylinders (9) Color.
We want to start by conducting a hypothesis test to study the relationship of each independent variable with the selling price at the 0.05 significance level. To study the affect of the independent variable “CONVERT” on the selling price, we have set the following Null and Alternate Hypothesis.
The null hypothesis tested is
H0: The mean price does not depend on whether the car is a convertible.
The alternative hypothesis is
H1: The mean price depends on whether the car is a convertible
Using the independent variable CONVERT and the dependent variable Selling price, following Regression output is generated by Excel Data Analysis.
SUMMARY OUTPUT | | | | | |
| | | | | | |
Regression Statistics | | | | | |
Multiple R | 0.386986 | | | | | |
R Square | 0.149758 | | | | | |
Adjusted R Square | 0.123993 | | | | | |
Standard Error | 3541.151 | | | | | |
Observations | 35 | | | | | |
| | | | | | |
ANOVA | | | | | | | | df | SS | MS | F | Significance F | |
Regression | 1 | 72887081 | 72887081 | 5.812481 | 0.021642 | |
Residual | 33 | 4.14E+08 | 12539754 | | | |
Total | 34 | 4.87E+08 | | | | |
| | | | | | | | Coefficients | Standard Error | t Stat | P-value | Lower 95% | Upper 95% |
Intercept | 7281.2 |

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