Annexure-V- Cover Page for Academic Tasks

Course Code: QTTM509 Course Title: Research Methodology I

Course Instructor: Dr. Pooja Kansra

Academic Task No.: 02 Academic Task Title: An outlook into the

pricing factor of Nissan.
Date of Allotment: 30th September 2021 Date of submission: 14th October, 2021

Student’s Roll no: RQ2142A59, RQ2142A66, RQ2142A67, RQ2142A73

Evaluation Parameters: (Parameters on which student is to be evaluated- To be mentioned by students as

specified at the time of assigning the task by the instructor)

Learning Outcomes: (We got practical exposure to descriptive statistics and statistical tools. We
were able to utilize the statistical tools on various data sets.)

Declaration:

I declare that this Assignment is our group work. We have not copied it from any other student "s
work or from any other source except where due acknowledgement is made explicitly in the text,
nor has any part been written for me by any other person.

Student's
Signature

Evaluator'scomments (For Instructor's use only)

General Observations Suggestions for Improvement Best part of assignment

Evaluator "s Signature and Date:

Marks Obtained: Max. Marks: …………………………

 PEER RATING

NAME REGISTRATION PEER Signature

NO. RATING

KRISHNA SHAH 12110894 10

SAKSHI BAJAJ 12112066 10

GOURI SAHA 12104462 10

BHARGAVA N/A
12112063 0
GOUDA

CONTENT

Topics Page no.

Title and Introduction 1

Note On Data 2

Research Questions 3-7

Appropriate Tools and Techniques 7-9

Recommendation and Conclusion 10

References and Links for Data Extraction 11

 An outlook into the pricing factor of Nissan

Introduction

Nishan Motor Corporation is a Japanese Multinational Company. Nissan is a part of the Renault–
Nissan–Mitsubishi Alliance science 1999. Nissan was the 6th largest automaker in the world in
the year 2013. It was the largest car manufacturer in North America in the year 2014 and in the
year 2018 it was the world's largest electric vehicle manufacturer.

Here we have chosen various models of Nissan like – Nissan versa, Nissan gt-r, Nissan kicks,
Nissan otti, Nissan clipper, Nissan titan, Nissan lotio, Nissan leaf, Nissan dayz, Nissan note,
Nissan juke, Nissan nv2000, Nissan teana etc. we have chosen these analyze price, citympg,
peak rmp, house power and engine size. Here we will use various statistical tools to find out the
little information about these models and this company. The statistical tools to be used in these
reports are regression and correlation.

With the help of excel, we have utilized statistical tools and techniques to investigate the
company's performance and extract information from the data of these companies. We have
analyzed few data and have got some fundamental outlook of these company's performance. We
have used some advance and essential functions of Excel to present the report in the best format.

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 Note on data

Car Name price engine size horsepower Peak-rpm City-mpg cylinder number
Nissan versa 5499 97 69 5200 31 4
Nissan gt-r 7099 103 55 4800 45 4
Nissan rogue 6649 97 69 5200 31 4
Nissan latio 6849 97 69 5200 31 4
Nissan titan 7349 97 69 5200 31 4
Nissan leaf 7299 97 69 5200 31 4
Nissan juke 7799 97 69 5200 31 4
Nissan latio 7499 97 69 5200 31 4
Nissan note 7999 97 69 5200 31 4
Nissan clipper 8249 97 69 5200 31 4
Nissan rogue 8949 120 97 5200 27 4
Nissan nv200 9549 120 97 5200 27 4
Nissan dayz 13499 181 152 5200 17 6
Nissan fuga 14399 181 152 5200 17 6
Nissan otti 13499 181 152 5200 19 6
Nissan teana 17199 181 160 5200 19 6
Nissan kicks 19699 181 200 5200 17 6
Nissan clipper 18399 181 160 5200 19 6

The data in the above table is extracted from Kaggle for our research and running statistical tools
like correlation and regression. Here in this data, we choose 6 variables among them on variable
(Price) is dependent variable while variables like Engine-size, Horsepower, City-mpg, Cylinder
number and peak rpm are the independent variable. These independent variables directly
influence the price of the car. The data is best suitable for regression analysis and correlation.
With the help of this data sets we can get the overview of how regression and correlation
analysis work in reality. With this data sets we have tried to answer few research question that
needs correlation and regression analysis to answer.

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 Research Questions

Qn. 1 How does the price of a car depend on the other factor and how are these factors
correlated?

Car Name price engine size horsepower Peak-rpm City-mpg cylinder number
Nissan versa 5499 97 69 5200 31 4
Nissan gt-r 7099 103 55 4800 45 4
Nissan rogue 6649 97 69 5200 31 4
Nissan latio 6849 97 69 5200 31 4
Nissan titan 7349 97 69 5200 31 4
Nissan leaf 7299 97 69 5200 31 4
Nissan juke 7799 97 69 5200 31 4
Nissan latio 7499 97 69 5200 31 4
Nissan note 7999 97 69 5200 31 4
Nissan clipper 8249 97 69 5200 31 4
Nissan rogue 8949 120 97 5200 27 4
Nissan nv200 9549 120 97 5200 27 4
Nissan dayz 13499 181 152 5200 17 6
Nissan fuga 14399 181 152 5200 17 6
Nissan otti 13499 181 152 5200 19 6
Nissan teana 17199 181 160 5200 19 6
Nissan kicks 19699 181 200 5200 17 6
Nissan clipper 18399 181 160 5200 19 6

Correlation table: -

Cylinder
price Engine size Horsepower Peak-rpm City-mpg number
price 1
engine size 0.935786691 1
horsepower 0.967481379 0.96935737 1
peak-rpm 0.184868886 0.158053769 0.258313935 1
city-mpg -0.839531017 -0.881981654 -0.910129207 -0.59779005 1
cylinder number 0.926288596 0.983318473 0.951942671 0.171498585 -0.871421253 1

Interpretation

With the data set above, we have calculated correlation between the Price and other factors of
cars such as, Engine Size, Horsepower, Peak-rpm, City-mpg, and Cylinder number. We can see

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that Price and Engine size are highly correlated as the value is 0.93 much near to 1. This
indicates that as the engine size of car increases the price of the car also increases. Similarly, the
horsepower and cylinder number of the car is also highly positively related to Price of the car.
The increase in horsepower and cylinder number highly effects the price of car. The correlation
between peak-rpm and price is also positive but is on the lower side. That means the rpm does
somewhat increase the price of the car but with very less extent. The city-mpg seems to have
negative correlation between prices. This means the car with higher prices have generally lower
mileage than that of cars with lower price.

Similarly, we can correlate all the factors with each other with the help of correlation table. For
example, the horsepower and city mileage are negatively correlated. It implies that as the
horsepower of the car increases the mileage of the car decreases.

Qn. 2 What would be the price of the car if a company intends to manufacture
cars with a Horsepower of 180, 220 and 250?

Regression Analysis: -
CarName price horsepower
Nissan versa 5499 69
Nissan gt-r 7099 55
Nissan rogue 6649 69
Nissan latio 6849 69
Nissan titan 7349 69
Nissan leaf 7299 69
Nissan juke 7799 69
Nissan latio 7499 69
Nissan note 7999 69
Nissan clipper 8249 69
Nissan rogue 8949 97
Nissan nv200 9549 97
Nissan dayz 13499 152
Nissan fuga 14399 152
Nissan otti 13499 152
Nissan teana 17199 160
Nissan kicks 19699 200
Nissan clipper 18399 160

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SUMMARY OUTPUT

Regression Statistics
Multiple R 0.967481379
R Square 0.936020218
Adjusted R Square 0.932021482
Standard Error 1167.377124
Observations 18

ANOVA
df SS MS F Significance F
Regression 1 318995690.4 318995690.4 234.0790026 5.67757E-11
Residual 16 21804309.61 1362769.351
Total 17 340800000

Coefficients Standard Error t Stat P-value Lower 95% Upper 95% Lower 95.0% Upper 95.0%
Intercept 746.5592765 689.2833064 1.083094962 0.294819222 -714.6560573 2207.77461 -714.6560573 2207.77461
horse power 94.28165386 6.162344352 15.2996406 5.67757E-11 81.21806741 107.3452403 81.21806741 107.3452403

Interpretation: -

We needed to predict the price of Nissan with some modified horsepower to see if the price is
best suitable for customer to spend. With the data above, the price, horsepower helps us to
predict the price of car. For this we have run regression analysis to find the intercept and
coefficients of independent variable to check the effect on depend variable i.e., Price. Here in
this scenario, Price is dependent variable while horsepower is independent variable. The R^2 is
0.93. R^2 states how well the regression model fits the observation. The R square states that 93%
of the data best fits the observation.

From the above table we can extract the regression equation

We know the regression equation is Y = b + ax

Here, Y(Price) = 746.55 + 94.28*X (desired horsepower)

With the help of this regression, we can easily calculate the estimate price of cars based on the
desired horsepower of the car. Though the price of the car also depends on other factors like
wheel size, engine size, thrust, stork, and many more. But in this scenario, we have used only
one independent factor that is horsepower. Using the above equation to calculate the price of
required Horsepower model car.

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Predicting the price of car based on Qn. 2

Horsepower Regression Equation Price (prediction)

180 Y = 746.55 + 94.28*180 17716

220 Y = 746.55 + 94.28*220 21488

250 Y = 746.55 + 94.28*250 24316

Data Interpretation: -

Firstly, speaking of the F-value i.e., significance-F = 5.67757E-11. This indicates that it is
statistically significant. We can reject the null hypothesis. Even the multiple R is good i.e.,
0.9674813789. this tells us the calculated linear regression equation fits the data. Coming to the
R square the value is around 0.936020218. This value is higher r-squared which indicates a
better fit for the model. A small P-value (typically ≤ 0.05) indicates strong evidence against the
null hypothesis, so we reject the null hypothesis.

Concluding, here the p-value is less than the significance level, the sample data provide
sufficient evidence to conclude that this regression model fits the data better than the model with
no independent variables.

Qn. 3 How is Horsepower and City-mpg (mileage per gallon) correlated?

From the above correlated table, we can see that the Horsepower and City-mpg is inversely
correlated. It means that as the horsepower of the car increases the mileage decreases.

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 Horsepower vs mileage

200

152 152 152 160 160

97 97
69 69 69 69 69 69 69 69 69
55
31 45 31 31 31 31 31 31 31 31 27 27 17 17 19 19 17 19

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18

horse power city-mpg

Interpretation: -
From the chart above we can see that as the horsepower of the car is increasing the mileage also
keeps decreasing. The proportion of increase and decrease may not be constant as other factors
also influences but in this case Horsepower of the car and mileage per gallon in inversely
proportional to each other.

Appropriate tools and techniques used

Correlation

The correlation coefficient (a value between -1 and +1) tells us how strongly two or more
variables are related to each other. We can use the CORREL function or the Analysis Toolpak
add-in, in Excel to find the correlation coefficient between two variables.

1. A correlation coefficient of +1 indicates a perfect positive correlation. As variable X

increases, variable Y increases. As variable X decreases, variable Y decreases.
2. A correlation coefficient of -1 indicates a perfect negative correlation. As variable X
increases, variable Z decreases. As variable X decreases, variable Z increases
3. A correlation coefficient near 0 indicates no correlation.

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To use the Analysis Toolpak add-in in Excel, to quickly generate correlation coefficients
between multiple variables, execute the following steps.

1. On the Data tab, in the Analysis group, click Data Analysis.

2. Select Correlation

3.select the range as the Input Range

4. Check Labels in first row.

5. Select a cell as the Output Range.

6. Click OK.

Uses in business

Correlation helps to test the relationship between different categorical variables The most
valuable use of a correlation is in predicting the future of a business direction. If marketers and
salespeople can identify a correlation between the behavior of consumers and events and a
particular type of product or service, they can take advantage of the relationship to boost
business and ultimately profits.

With the widespread use of computers in modern business, significant amounts of data and files
exist in many businesses. Companies have found that sorting this information can identify
patterns otherwise not visible in folders or isolated in operational silos of business functions. By
looking for data relationships and correlations or “data-mining,” businesses have found they can
leverage existing information for better management, customer retention and improved
operations.

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Regression

Regression is a statistical tool used to find out the relationship, if any, exists between a set of
data. Regression equation helps us to predict the data for future indication or shows the past
behavior. It is used in many streams like finance, investing and many other disciplines in a
attempt to determine the strength between two variables. Dependent (normally denoted by Y)
and independent variable (normally denoted by X).

The linear regression equation is shown below.

Y = a + bx

𝑁Σ𝑋𝑌−(Σ𝑋)∗(Σ𝑌) ∑𝑦−𝑏∑𝑥
B= a=
𝑁(Σ𝑥 2 ) − (∑𝑥)2 𝑁

Where,

N= No. of observation

X = independent variable

Y = dependent variable.

Use in business:

Regression helps the investment and financial managers and other data analysts to value assets
and determine the relationship among variables like price, commodity, and stocks. It can also
help to predict the sales for a product based on the other indirect factors affecting it like GDP,
Per capita Income, and many others. For example, in case of NISSAN we have found the
regression equation based on the data given and with the equation’s coefficient and intercept we
can determine the price of a new model with desired horsepower of the car.

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 Recommendation

Nissan must provide unique and innovative automotive products and services that can deliver
superior and comfortable aspects to all customers worldwide. It should try to expand its product
portfolio according to the need and wants of customers by getting their views through research
question and surveys. Nissan's marketing strategy and other several factors can help in increasing
its sales worldwide as they must realize how much the customer is willing to spend. Its products
is comparatively in order to not only just capture the market share but also to ensure that
customer loyalty is always maintained as well as more number of customers can afford it easily.

Since Company is well known for his strong build quality and luxurious features, it should also
more focus on the safety measures from which it can get more recognition and a greater number
of customers can be attracted Because in today's era safety plays an integral role for the customer
values. Nissan must find better solution to fulfill the needs of the customer and make them to
choose their product as compared to other company's products. It should use innovative
technology and digitize its retail process as much as possible. Because Retail and Pricing factors
have a significant impact on the sale of products. So that a greater number of customers will get
interested to buy their products.

Conclusion

In a nutshell I would like to conclude that, with the statistical tools and techniques we have used,
we found that the price factor of a product is affected by other factors also whether it be
positively or negatively. For the prediction of a dependent variable with desired independent
variable we must use regression analysis to determine how many specific factors influence the
price movement of an asset. We have seen that as the horsepower of the car increases the price
also increases it may be due to use of extra heavy engine and more stroke engine. Moreover, the
mileage per gallon also decreases as the horsepower increases but still people prefer to buy the
car with more horsepower. Nissan has able to maintain large variation in its product portfolio,
but it should need to see what the customers really want and can survey in the market with the
predicted price before launching the product. It will give company the idea regarding the demand
for the car at that particular price.

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 References

1. https://www.nissan-global.com/EN/index.html

2. https://www.kaggle.com/hellbuoy/car-price-prediction

3. https://www.investopedia.com/terms/r/regression.asp

4. https://www.investopedia.com/ask/answers/032515/what-does-it-mean-if-
correlation-coefficient-positive-negative-or-zero.asp

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