Project report

on
“MANAGERIAL COMPUTER LAB”
Under the supervision of
Dr. Sunil Kakkar
Dean (Academics) & Professor - Marketing & Analytics
Subject: Managerial Computer Lab
Submitted By:
Preeti sinha
MBA 2nd Semester

Poddar Management and Technical Campus

Jaipur
 Acknowledgement

The project report on “Managerial Computer Lab” is an outcome of guidance, moral,

support and devotion on me through my work. For this let me acknowledge and express my
performance sense of gratitude and thanks to everybody who have been source of inspiration
during the project.

I would like to express my special thanks of gratitude to my teacher, Dean (Academics) &
Professor - Marketing & Analytics Dr. Sunil Kakkar Sir who gave me the golden
opportunity to do this wonderful project on the topic Role of managers in implementing
technological changes in an organization which also helped me in doing lot of research work
and through this I came to know many new things. I am really thankful to them.

Secondly, I would also like to thank my parents and friends who helped me a lot for
preparing this project within limited time frame.

Preeti sinha
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INDEX

Q1. How to determine the optimal solution using excel solver for the problem/case study
related to transportation?

Q2. Explain factor analysis for data reduction.

Q3. How to carry out One Way ANOVAs and Two Way ANOVAs?
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Q1:-HOW TO DETERMINE THE OPTIMAL SOLUTION USING EXCEL SOLVER
FOR THE PROBLEMS / CASE STUDY RELATED TO TRANSPORTATION?

ANS:-Transportation problem in Excel

Let’s look at a linear programming problem to minimize the transportation cost. Three
companies C1, C2, C3 are expected to deliver goods to three destinations D1, D2, D3.

Form a table of values that includes the goods needed, goods that are available in the
companies, goods that are reached, and goods that are to be delivered to the destinations.

The to-be-delivered goods are the sum of goods that are to be delivered to a destination by all
the three companies and the reached goods are the sum of goods delivered by a company to
all three destinations.

In the optimal solution cell enter the formula =SUMPRODUCT(array1,array2).

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After entering all the details and the formulas go to the Data tab, under analyze group click
on the solver tool.
Now the solver parameters dialog box opens up. In the set objective field select the cell to
display the optimal solution.
In to field select Min so as to minimize the transportation cost. In the By changing variable
cells field select the range of cells which depends upon the data of goods to be delivered,
goods available, goods reached, and goods needed, In this problem C8:E10.
In subject to the constraints, field click on add, set to be delivered goods as less than or equal
to available goods in the cell reference field and set reached goods as equal to the needed
goods.
In select a solving method field select simple LP and click on solve.
Use the solver in Excel to find the number of units to ship from each factory to each customer
that minimizes the total cost.
Formulate the Model
The model we are going to solve looks as follows in Excel.

Q2:- EXPLAIN FACTOR ANALYSIS FOR DATA REDUCTION.

ANS:- Factor Analysis is a Data Reduction Technique which helps in reducing the features
by identifying variables that are highly correlated to each other. In a way, factor analysis is
kind of a classification technique as it groups the features by extracting the maximum
common variance from all the variables. To Perform factor analysis, we require continuous
variables (numerical, interval scaled) with a good sample size.
Factor Analysis can be complex to understand without an example, so an example will be
used to explain the whole process of factor analysis.

Extraction and Factor Rotation

The whole idea of factor analysis is that by having all the variables, we have 100% data
which in statistical terms mean 100% variance. When we reduce the number of variables and
still try to cover 70-80% of data, we in a way are trying to capture 70-80% of the variance,
therefore, the target is reducing the maximum number of variables and at the same time
retaining most of the variance provided by the variables. For this, we are grouping the
variables into groups known as factors. However, we initially don’t have any idea about how
many of these groups are to be created and in most statistical software, a hit and trial method
is used where as a thumb rule, we assume that each factor has 4 variables thus we divide the
total number of variables by 4 or 5 and the output is what becomes the initial number of
factors required for performing factor analysis. In our case we take 20 ÷ 5 = 4, therefore we
decide to perform a factor analysis with a four-factor solution. Now to group all the variables
into 4 factors, Factors Analysis uses a method known as Extraction. In this process, it first
finds the largest group of variables that are highly correlated to each other and creates a group
from them and this group (factor) explains most of the variance of all the variables in the
analysis. Then it proceeds to find the next batch of highly correlated variables, with this
second factor explaining the second most variance in all the variables and so on. In our
example, we take a four-factor solution so we end up with four of these factors.
 
The output looks something like this-
 

5
 
 
Here each of these analysis or row is a factor loading. The values of these factor loading are
very similar to correlation coefficients where a higher value means that variable highly
defines that group (factor).

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 This output is generated through extraction; however, there are many ways through which
extractions can be done such as-
 Principal Component Analysis
 Maximum Likelihood
 Image factoring
 
 
One of the most commonly used methods of extraction, which will be discussed briefly here
is Principal Component Analysis.
In Principal Component Analysis, the maximum variance is extracted and is placed in the
first factor. Then for constructing the second factor, the variance explained by the first factor
is removed. This process is done for all the factors. This method of extraction is so common
that it is the default method of extraction for factor analysis in most of the statistical software.
As mentioned above, the factors need to be distinct from each other and in order to do this the
original variable space is rotated, this is known as Factor Rotation. There are many ways to
rotate the spaces. The most common method of rotation commonly associated with Principal
Component Analysis is VARIMAX where we extract the maximum variance by rotating the
principal axis. This method of rotation is also called orthogonal rotation. Other methods of
rotation are also there such as PROMAX also known as oblique rotation where the
assumption that the factors are orthogonal to one another is dropped creating factors that are
correlated with each other.
Both these methods of rotation are important and can be used, however, PROMAX is
generally considered to be better as in the real world, factors will be moderately correlated to
each other and won’t be that starkly unique as presented by VARIMAX, however,
VARIMAX is easy to score, interpret and thus have its own set of advantages. Other
rotational strategies are QUARTIAX, EQUAMAX etc. In general, PCA is followed by
VARIMAX with the former constructing latent factors while the later making the factors
distinct.

Selecting Variables
The final step includes picking variables from each factor. Here we group the variables that
have the highest factor load for that factor and from them chose the relevant variables. This
part is very subjective and the variables that are selected from each factor depends on various
factors such as business scenario, client demand etc.
 
 

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Q3:-HOW TO CARRY OUT ONE WAY ANOVA AND TWO WAY ANOVA?
ANS:-
One way ANOVA:
Definition:

One way ANOVA test is a kind of ANOVA that aims to find if there is a significant
statistical difference among the means of two or more independent groups.

Explanation:

One-way ANOVA is a major type of ANOVA, also called One-factor ANOVA, One-way

analysis of variance, and Between Subjects ANOVA. As the name suggests, one-way
ANOVA is a unidirectional ANOVA that analyses the impact of one factor-independent
variable. Though it considers only one independent variable, there is more than one level of
the independent variable that it accounts for. It segments one independent variable into
multiple levels. For example, social media consumption is one independent variable that can
be divided into multiple levels as low, medium, and high levels. This test aims to compare
two or more independent groups and find whether there is a statistical difference between the
means of those groups. One thing to remember is that one-way ANOVA is an omnibus test. It
means that it can only tell you that the groups are statistically different but does not tell you
specifically which groups are different. You may have three, four, five, or even more groups,
and by carrying out this test, you will only find if there is a difference in the groups and not
exactly which groups have the difference.

The variables that One-way Anova uses are:

1. Dependent Variables:

These are the kind of variables that depend on other factors in an experiment. They change
with the manipulation of other variables. For example, how stress influences mental health.
Mental health is a dependent variable that depends on stress.

2. Independent Variables: 

Independent variables remain unaffected by any manipulation to a factor of the experiment.

These variables have an individualistic and independent character. In fact, they affect the
dependent variable in an experiment. From the aforementioned example, stress is the
independent variable as it affects the dependent variable: Mental health.
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Assumptions of One-way ANOVA:

The assumptions of one-way ANOVA are similar to ANOVA, with a few exceptions.

 The sample is taken from a normally distributed population

 Each sample is drawn independently.
 The data shows homogeneity of variance.
 The dependent variable must be continuous that can be measured on a scale that can
be subdivided.

When to use One-way ANOVA?

You can use one-way ANOVA when your data has:

1. One categorical independent variable

2. One quantitative dependent variable. 

In statistics, a categorical variable is a variable that has multiple categories. For example, skin
color is a categorical variable with multiple white, black, and brown categories. The
independent variable needs to have multiple levels or categories as they are the main focus of
this test. By multiple, it means more than two groups as two groups can be compared through
a T-test.

Examples of One-way ANOVA:

Example 1: 

Suppose you are studying the impact of CBD oil on weight loss. You will categorize the
people into groups consuming Isolate CBD, Full-spectrum CBD, and Broad spectrum CBD.
In this condition, the categorical independent variable is CBD, which has three categories,
and the dependent variable is weight loss.

TWO WAY ANOVA:

The two-way ANOVA (“analysis of variance”) is used to determine whether or not there is a

statistically significant difference between the means of three or more independent groups
that have been split on two variables (sometimes called “factors”).
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This tutorial explains the following:

 When to use a two-way ANOVA.

 The assumptions that should be met to perform a two-way ANOVA.
 An example of how to perform a two-way ANOVA.

When to Use a Two-Way ANOVA

You should use a two-way ANOVA when you’d like to know how two factors affect a
response variable and whether or not there is an interaction effect between the two factors on
the response variable.

For example, suppose a botanist wants to explore how sunlight exposure and watering
frequency affect plant growth. She plants 40 seeds and lets them grow for two months under
different conditions for sunlight exposure and watering frequency. After two months, she
records the height of each plant.

In this case, we have the following variables:

 Response variable: plant growth

 Factors: sunlight exposure, watering frequency

Two-Way ANOVA Assumptions

For the results of a two-way ANOVA to be valid, the following assumptions should be met:

1. Normality – The response variable is approximately normally distributed for each group.

2. Equal Variances – The variances for each group should be roughly equal.

3. Independence – The observations in each group are independent of each other and the
observations within groups were obtained by a random sample.

Two-Way ANOVA:

Example

A botanist wants to know whether or not plant growth is influenced by sunlight exposure and
watering frequency. She plants 40 seeds and lets them grow for two months under different
conditions for sunlight exposure and watering frequency. After two months, she records the
height of each plant. 
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