BUS 5030: Applied Economics and Statistics

Module 5: Milestone 2 Worksheet

Understanding the Product and the Environment Worksheet

Milestone 2: Understanding the Product and the Environment

Moses Mayowa Daniel

Master of Business Administration, Nexford University

BUS 5030: Applied Economics and Statistics

Dr. Michael McGivern

February 7, 2022

Understanding the Product and the Environment Worksheet

 BUS 5030: Applied Economics and Statistics
Module 5: Milestone 2 Worksheet
Understanding the Product and the Environment Worksheet

Directions: Answer the following questions.

What are the important factors (sun, rain, etc.) in selling umbrellas?

 Statistical technique you would use:

 Reason for using the statistical technique:

 Application of the statistical technique:

As consideration for protection during rainfall, Umbrellas and other protective coverings like raincoats and waterproof jackets are mostly

used. Particularly for umbrellas, several elements are deliberated upon before making the choice for protection. Such factors include the

volume of rainfall, the atmospheric temperature at the time of consideration, and ease of movement. During periods of consistent

downpour, the demand for umbrellas increases, as commuters need them to commute easily, likewise, to avoid wetness and prevent

possible health issues from exposure to cold, Furthermore, periods of high-intensity sunlight also add to the need for umbrellas. Lately,

umbrellas are also used during photography sessions, as well as for party games, decoration, fashion statements, lampshades, or plant

cover (for plants that may not survive under heavy rain and require a little extra coverage to fare well during winter months).
 BUS 5030: Applied Economics and Statistics
Module 5: Milestone 2 Worksheet
Understanding the Product and the Environment Worksheet

Other uses of Umbrellas - Image source: https://www.umbrellaworkshop.com

2. For this analysis, I would use the Multiple Linear Regression (MLR) model as the statistical technique.

3. As a statistical technique, the multiple linear regression model helps to explain the relationship between the independent (explanatory)

factors and the dependent (response) variable. When there is more than one independent factor, the ideal strategy is to utilize a multiple

linear regression model. Here, the number of umbrellas sold is our dependent variable, which we wish to forecast, while rainfall and

atmospheric temperature are our independent factors, the determining factors to predict the outcomes of the dependent variable.

4. In this paper, I shall investigate the connection between the sales of umbrellas and the obtained data for average rainfall and temperature in

Tunisia using data obtained from the World Bank portal, 2021. Multiple Linear Regression will be applied to determine the weight of the

average rainfall and temperature data.

 BUS 5030: Applied Economics and Statistics
Module 5: Milestone 2 Worksheet
Understanding the Product and the Environment Worksheet

Average Average
Month No. of Umbrellas Rainfall Temperature
s Sold (thousands) (mm) (°C)

Jan 29 36.2 10.13

Feb 115 28.72 11.52

Mar 319 28.83 14.41

Apr 571 22.41 17.66

May 802 15.02 21.72

Jun 946 7.2 26.14

Jul 1075 2.12 28.78

Aug 1149 5.41 28.86

Sep 1242 20.22 25.85

Oct 758 32.69 20.98

Nov 126 30.35 15.48

Dec 36 34.31 11.47

Data Source: (World Bank Climate Change Knowledge Portal, 2021)

 BUS 5030: Applied Economics and Statistics
Module 5: Milestone 2 Worksheet
Understanding the Product and the Environment Worksheet
 BUS 5030: Applied Economics and Statistics
Module 5: Milestone 2 Worksheet
Understanding the Product and the Environment Worksheet

Figure 1Results shown are generated from Multi Linear Regression Calculator 2 (Multiple Regression Calculator for 2 Predictor Variables, n.d.)
 BUS 5030: Applied Economics and Statistics
Module 5: Milestone 2 Worksheet
Understanding the Product and the Environment Worksheet

How much does rainfall vary over the year?

● Statistical technique you would use:

● Month
Reason for using the statistical technique: Averagetechnique:
● Application of the statistical rainfall (mm)

1. For assessing how much rainfall fluctuates throughout the year in Tunisia, I like to use
January variance analysis.
36.2

2. The variance will be used to compare theFebruary

monthly rainfall data in the collection to the mean and, as a result, to every other monthly
28.72
rainfall data in the set. Therefore, by calculating the variance in each month of the year, the data will reveal how much the amount of rainfall
March 28.83
fluctuates.
April 22.41
3. Application of the data set.
May 15.02

June 7.2

July 2.12

August 5.41

September 20.22

October 32.69

November 30.35

December 34.31
 BUS 5030: Applied Economics and Statistics
Module 5: Milestone 2 Worksheet
Understanding the Product and the Environment Worksheet
 BUS 5030: Applied Economics and Statistics
Module 5: Milestone 2 Worksheet
Understanding the Product and the Environment Worksheet

Average Rainfall (mm)

Mean 1.95666667

Standard Error 3.449306986

Median 25.565

Mode #N/A

Standard 11.9487499

Deviation

Sample Variance 142.7726242

Kurtosis -1.199791083

Skewness -0.553244697

Range 34.08

Minimum 2.12

Maximum 36.2
 BUS 5030: Applied Economics and Statistics
Module 5: Milestone 2 Worksheet
Understanding the Product and the Environment Worksheet

Sum 263.48

Count 12

A huge variance suggests that the numbers in the set are distant from the mean and each other, whereas a small variance indicates the inverse.

The computed variance, using an excel calculator for descriptive statistics, is 142.80. Because our variance is tiny, this means that the amount

of rainfall each month does not vary significantly. Also, we can observe that rainfall is most from October to March, with a peak in January,

while rainfall decreases from April to August, with the least rainfall in July.

How much does temperature vary over the year?

● Statistical technique you would use:

● Reason for using the statistical technique:

● Application of the statistical technique:

 BUS 5030: Applied Economics and Statistics
Module 5: Milestone 2 Worksheet
Understanding the Product and the Environment Worksheet

1. To determine how much temperature varies over the year in Tunisia, my choice of technique is the use of variance.
 BUS 5030: Applied Economics and Statistics
Module 5: Milestone 2 Worksheet
Understanding the Product and the Environment Worksheet

Average Temperature (oC)

Mean 19.41666667
 BUS 5030: Applied Economics and Statistics
Module 5: Milestone 2 Worksheet
Understanding the Product and the Environment Worksheet

Standard Error 1.997323714

Median 19.32

Mode N/A

Standard deviation 6.918932305

Sample Variance 47.87162424

Kurtosis -1.58402995

Skewness 0.086348227

Range 18.73

Minimum 10.13

Maximum 28.86

Sum 233

Count 12
 BUS 5030: Applied Economics and Statistics
Module 5: Milestone 2 Worksheet
Understanding the Product and the Environment Worksheet

Calculated variance is 47.9% using an excel calculator for descriptive statistics. Because our variance is tiny, we may conclude that there is no

significant difference or variation in temperature throughout the year. August is the hottest month, and January is the coldest.

How would you forecast rain based on past predictions? Why?

● Statistical technique you would use:

● Reason for using the statistical technique: ● Application of the statistical technique:

1. To forecast rain in Tunisia using the past predictions, my choice of technique is Exponential Smoothing.

2. Exponentially smoothed forecasts are weighted averages of previous time-series data, with the weights decreasing as the data gets

older. This method is used to forecast future trends.

3. I use data on the average temperature in Tunisia obtained from the World Bank Climate Change Portal, 2021, with smoothed values

written under projected rainfall, to calculate how temperature varies over the year (mm)
 BUS 5030: Applied Economics and Statistics
Module 5: Milestone 2 Worksheet
Understanding the Product and the Environment Worksheet

Month Average rainfall (mm) Projected rainfall (mm)

January 1 36.2 36.2

February 2 28.72 32.46

March 3 28.83 30.645

April 4 22.41 26.5275

May 5 15.02 20.77375

June 6 7.2 13.9868375

July 7 2.12 8.0534375

August 8 5.41 6.73171875

September 9 20.22 13.47585938

 BUS 5030: Applied Economics and Statistics
Module 5: Milestone 2 Worksheet
Understanding the Product and the Environment Worksheet

October 10 32.69 23.08292969

November 11 30.35 26.71646484

December 12 34.31 28.53323242

 BUS 5030: Applied Economics and Statistics
Module 5: Milestone 2 Worksheet
Understanding the Product and the Environment Worksheet

List the reference information for the internet research you used for your research. (A minimum of one reference must be provided.)

References

5 Unusual Ways to use an Umbrella. (2021, January 23). Umbrella Workshop. https://www.umbrellaworkshop.com/umbrellas/5-unusual-
 BUS 5030: Applied Economics and Statistics
Module 5: Milestone 2 Worksheet
Understanding the Product and the Environment Worksheet

ways-to-use-an-umbrella/

10 alternative uses for an umbrella | Jollybrolly Blog. (n.d.). Www.jollybrolly.co.uk. Retrieved February 7, 2022, from

https://www.jollybrolly.co.uk/umbrella-news/10-alternative-uses-umbrella/

Multiple Regression Calculator for 2 Predictor Variables. (n.d.). Www.socscistatistics.com.

https://www.socscistatistics.com/tests/multipleregression/default.aspx

World Bank Climate Change Knowledge Portal. (n.d.). Climateknowledgeportal.worldbank.org.

https://climateknowledgeportal.worldbank.org/country/tunisia