Data: Razor.xls

Compute Using: Microsoft Excel functions and/or Data Analysis Toolpak, Regression

The marketing department of a large supermarket chain wants to study the effects of price on the sale of

packages of disposable razors. Data are collected from a sample of 15 stores with equivalent store traffic

and product placement (i.e., at the checkout counter). Five stores are randomly assigned to each of the

three price levels (79, 99, and 119 cents) for the package of razors. After conducting your analysis,

provide a recommendation. The data are provided for you in Razor.xls.

1. Construct a scatter plot for price and sales.

2. Fit a quadratic regression model and state the quadratic regression equation.

3. Predict the weekly sales for a price per package of 79 cents.

4. At the 0.05 level of significance, is there a significant quadratic relationship between weekly sales

and price?

5. At the 0.05 level of significance, determine whether the quadratic model is a better fit than the

linear model.

6. Interpret the meaning of the coefficient of multiple determination.

7. Compute the adjusted R2.

8. Consider ethical issues associated with multiple regression analysis. What are some of the pitfalls

of multiple regression?

Razor Data
Price (cents)	PriceSquared	Sales
79	6241	142
79	6241	151
79	6241	163
79	6241	168
79	6241	176
99	9801	91
99	9801	100
99	9801	107
99	9801	115
99	9801	126
119	14161	77
119	14161	86
119	14161	95
119	14161	100
119	14161	106
Price	Sales
79	142
79	151
79	163
79	168
79	176
99	91
99	100
99	107
99	115
99	126
119	77
119	86
119	95
119	100
119	106