NAME : CHINMAY JAPE :: SAP NO.

: 80203190079 :: DATE : 10/08/2020

SOULTION TO ASSIGNMENT ON MULTIPLE LINEAR REGRESSION

QUESTION:

Use file Grocery.xlsx and answer the questions below (10 marks)
For 12 straight weeks you have observed the sales (in number of cases) of canned
tomatoes at Mr D's supermarket
Each week you keep track of the following -
a. Was a promotional notice for canned tomatoes placed in all shopping carts?
b. Was a coupon for canned tomatoes given to each customer?
c. Was a price reduction (none, 1 or 2 cents off) given?
Use this data to determine how the preceding factors influence sales. Predict sales of canned
tomatoes during a week in which you use a shopping cart notice, a coupon and reduce price
by 1 percent?

SOLUTION:
The assignment was attempted using Python.
Characteristics of the data: The data has 12 rows and 5 columns. There are 4 independent
variables (Week, Cart Notice, Coupon, Price Reduction) and a dependent variable (Sales).

We can remove week column since it is not significant for our prediction.
The columns Cart Notice and Coupon are categorical variables, so we can convert them to
dummy variables so that we can make a better (unbiased) prediction.
We will use Python’s get_dummies function to do this.
 NAME : CHINMAY JAPE :: SAP NO. : 80203190079 :: DATE : 10/08/2020

We now have our data in shape, we can go ahead with preparing the regression model.

The regression results are summarized as follows:

 NAME : CHINMAY JAPE :: SAP NO. : 80203190079 :: DATE : 10/08/2020

Upon regression run 1 we found Coupon variable to be insignificant. We will now run the
model again eliminating Coupon.
Regression Run 2:

From the results, we observe the following statistics:

R-Squared : .882
Adj. R-Squared : .855
We also observe that there are no insignificant variables based on the p-values of the
variables. All p-values fall under 5% limit.
We will now make prediction as a requirement of our question.

Preceding factors influence on sales:

Price Reduction: With one unit increase in Price Reduction, Sales increase by 6.37 units.
Cart_Notice: If cart notice is Yes, then sales increases by 20.1667 units.
 NAME : CHINMAY JAPE :: SAP NO. : 80203190079 :: DATE : 10/08/2020

Predict sales of canned tomatoes during a week in which you use a shopping cart notice,
a coupon and reduce price by 1 percent?

Ans:

Sales: