Table 5-17 on the textbook's Web site contains data about several magazines. The variables are: magazine name, cost of a full-page ad, circulation (projected, in thousands), percent male among the predicted readership, and median household income of readership. The goal is to predict the advertisement cost.
a. Create scatter grams of the cost variable versus each of the three other variables. What types of relationships do you see?
b. Estimate a linear regression equation with all the variables and create a residuals versus fitted values plot. Does the plot exhibit constant variance from left to right?
c. Now estimate the following mixed model:
In Yi = B0 + B1 In Circ + B2 PercMale + B3 Med Income + ui
and create another residual plot. Does this model fit better than the one in part (b).