Contents
ASSIGNMENT TASKS ........................................................................................................................................................ 3
ANSWER 1: DATA TABLE ............................................................................................................................................................3
ANSWER 2: LINE GRAPH OF PROFIT ........................................................................................................................................4
List of Figures
Figure 1: Line Graph of the Profit per Quarter ............................................................................................................................ 4
Figure 2 Time Series Plot of the Numbers of Staffs And Middle & Senior Staffs ...................................................... 6
Figure 3 Time Series Plot of the Numbers of Staffs & Mgt. Staffs with Trend ........................................................... 6
Figure 4 ScatterPlot of Profit vs. Revenue .................................................................................................................................... 8
Page 2
Assignment Tasks
Answer1: Data Table
Printout of the data in the sample:
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.
13.
14.
15.
16.
17.
18.
19.
20.
21.
22.
23.
24.
25.
26.
27.
28.
29.
30.
31.
32.
33.
34.
35.
++
 id
quarter
staff
mstaffmsalary
revenue
profit 

 1
1
242
15
3.6
85.7
4.7 
 3
2
251
18
3.9
91.6
6.2 
 6
3
255
18
3.9
93.3
5.3 
 8
4
262
16
3.4
56.3
3.2 
 9
5
263
21
4.5
79.2
4.5 

 11
6
262
20
4.3
63.4
3.6 
 12
7
267
23
4.9
58.1
3.3 
 13
8
260
22
4.7
73.9
4.2 
 15
9
263
24
5.2
72.2
4.1 
 17
10
265
24
5.1
77.4
4.4 

 19
11
268
24
5.1
56.3
3.2 
 21
12
261
25
5.4
81
4.6 
 22
13
263
25
5.4
44
2.5 
 23
14
263
26
5.6
22.9
1.3 
 26
15
262
26
5.6
40.5
2.3 

 27
16
268
27
5.8
22.9
1.3 
 29
17
228
13
2.6
21.1
1.2 
 33
18
228
13
2.6
43.3
3.7 
 34
19
221
15
3
32.8
2.8 
 36
20
233
15
3
29.3
2.5 

 38
21
225
17
3.4
25.7
2.2 
 40
22
226
16
3.2
32.8
2.8 
 42
23
235
17
3.4
43.3
3.7 
 43
24
238
18
3.6
41
3.5 
 44
25
241
18
3.6
42.1
3.6 

 46
26
235
17
3.4
44.5
3.8 
 47
27
241
18
3.6
39.8
3.4 
 51
28
241
18
3.6
53.8
4.6 
 53
29
248
19
3.8
44.5
3.8 
 54
30
245
18
3.6
65
5.6 

 55
31
253
19
3.7
62
5.3 
 56
32
256
19
3.8
64
5.4 
 57
33
259
20
3.9
66
5.7 
 58
34
257
20
3.8
65
5.6 
 59
35
260
20
3.9
67
5.8 
++
Page 3
From the graph we can easily understand that, after the 17thquarter the profit began to
increase again. We are taking this as the point at which the takeover was completed
and the new management team was in place.
Page 4
Staff Numbers
Answer 3: Summary Statistics
Table 1: Summary Statistics of staff numbers for the period of time before
the takeover.
Variable 
Obs
Mean
Std. Dev.
Min
Max
+staff 
17
259
10.27132
228
268
mstaff 
17
21.58824
4.243507
13
27
Table 2: Summary Statistics of staff numbers for the period of time after the
takeover.
Variable 
Obs
Mean
Std. Dev.
Min
Max
+staff 
18
241.2222
12.29326
221
260
mstaff 
18
17.61111
1.914001
13
20
These two summary tables illustrate that, both the mean staff numbers and mean middle &
senior management staff numbers has been decreased from the period of time before the
takeover to the period of time after the takeover. Average stuff numbers decreased from
259 to 241 and middle& senior management staff numbers decreased from 21.59 to 17.61.
Page 5
Number of Staffs
Figure 2 Time Series Plot of the Numbers of Staffs And Middle & Senior Staffs
The time series plot says us, here exist increasing trends in the numbers of both staffs and
management staffs; but after takeover, the new management cut off many of their old
employees.
300
Number of Staffs
250
y = 0.4471x + 257.9
R = 0.1016
200
150
100
y = 0.0751x + 20.894
R = 0.0412
50
0
1
staff
9 11 13 15 17 19 21 23 25 27 29 31 33 35
mstaff
Linear (staff)
Linear (mstaff)
Figure 3 Time Series Plot of the Numbers of Staffs & Mgt. Staffs with Trend
Page 6
Using the time series plot and the trend lines it is comprehensible that the takeover has
changed a lot in the employee pattern of Solidon. earlier to its takeover Solidons number of
staffs and management staffs were increasing, so as their operational cost (Salary).
Immediately before the takeover the number of staffs and management staffs were 268 and
27 respectively. But, subsequent to its takeover the new management cut off old inefficient
employees, so as their redundant operational cost (Salary).
Thats why instantly after the takeover the number of staffs and management staffs of
Solidon become 228 and 13 respectively. So, we can say the employee cutoff was a very
sudden decision of the new management.
Page 7
20
40
60
Total revenue, in $1,000,000
80
100
The scatter plot shows an upward flow and a positive relationship between Revenue and
Profit for Solidon. The correlation coefficient indicates the strength and direction of a linear
relationship between two variables. Thats why, in order to measure the strength and
direction of association between Revenue and Profit for Solidon in the sample, I have used
correlation:
. correlate profit revenue
(obs=35)

profit revenue
+profit 
1.0000
revenue 
0.8265
1.0000
The statistics shows that, association between Revenue and Profit for Solidon is strong and
positive (.827). So, we can say that, the higher the Revenue is, the higher the Profit will be.
Page 8
Number of obs =
35
F( 1,
33) =
71.15
Prob> F
= 0.0000
Rsquared
= 0.6831
Adj Rsquared = 0.6735
Root MSE
=
.7644
profit 
Coef.
Std. Err.
t
P>t
[95% Conf. Interval]
+revenue
.0545647
.0064688
8.44
0.000
.0414038
.0677256
_cons 
.8552672
.3744752
2.28
0.029
.0933916
1.617143

The equation of the regression line which could be used to predict the Profit of Solidon
from the Revenue of Solidon is:
Profit = .85527 + .0546 (Revenue)
Here Predictors are: (Constant) &Total Revenue (in $1,000,000), and Dependent Variable
is: Profit (in $1,000,000).
Rsquare measures the proportion of the variation in the dependent variable (wage) that
was explained by variations in the independent variable(s). In this sample, the "RSquare"
is 0.6831 and telling us that 68% of the variation was explained. On the other hand,
Standard error of the estimate measures the dispersion of the dependent variable(s)
estimate around its mean (in this sample, the Std. Error of the Estimate is .00647).
Here the gradient or slope of the regression line is .0546. This means if the independent
variable (Revenue) increased by 1 unit then the dependent variable will be increased by
0.0546 units.
In this case the constant or intercept value is equal to .85527 and this is significant at 95%
confidence level. Here the pvalue for the constant is 0.029 which is smaller than 0.05.
Thats why we can say it is significant at 5% level.
Here, the pvalue for the regression model is 0.000 (F (1, 33) = 71.15). Thats why we can
tell indisputably that this regression model is excellent and significant.
Page 9
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