BUSINESS STATISTICS Group 6 – Section F

PROPERTY ANALYSIS
DATA CLASSIFICATION

Variable Data Type

Assessed Value Ratio
Floor Space Ratio
Number of Offices Ratio
Entrances Ratio
Age Ratio
Freeway Proximity Nominal
PROPERTY COMPOSITION
Properties by Age
35

30

25

20

15

10

0
Age 1- 10 Age 11-20 Age 21-30 Age 31-40 Age 41-50 Age 51-60 Age 61-70

Number of Properties
PROPERTY COMPOSITION
Properties by Size
30

25

20

15

10

0
0-1000 sq ft 1001-2000 sq ft 2001-3000 sq ft 3001-4000 sq ft 4001-5000 sq ft 5001-6000 sq ft

Number of Properties
MEAN ANALYSIS
MEAN ANALYSIS
MEAN ANALYSIS
MEAN ANALYSIS
BINOMIAL DISTRIBUTION –
FREEWAY PROXIMITY
0.09

0.08

0.07

0.06

0.05

binonial distribution of office away from freeway

0.04
binomial distribution of office near freeway

0.03

0.02

0.01

0
1 5 9 13 17 21 25 29 33 37 41 45 49 53 57 61 65 69 73 77 81 85 89 93 97
ANOVA
Cost of Property with Proximity to Freeway

Anova: Single Factor

SUMMARY
Groups Count Sum Average Variance
374.9478079 54 23697.15 438.836 73179.97441
344.0559441 44 20805.99 472.8634 81944.53651

ANOVA
Source of Variation SS df MS F P-value F crit
Between Groups 28072.25 1 28072.25 0.364074545 0.547675 3.940163
Within Groups 7402154 96 77105.77

Total 7430226 97
ANOVA
Cost of Property with respect to Age

Anova: Single Factor

SUMMARY
Groups Count Sum Average Variance
496.3442636 43 19784.69 460.1092 80822.15217
1619.90897 37 15691.28 424.0887 44538.05389
917.9802605 17 6711.933 394.8196 48750.10054

ANOVA
Source of Variation SS df MS F P-value F crit
Between Groups 58960.73 2 29480.36 0.479612524 0.62053 3.093266
Within Groups 5777902 94 61467.04

Total 5836863 96

Mean for age of property 20-40yrs: 455.56 Mean for age of property b/w 1-20 yrs: 460.93
FLOOR SPACE – ENTRANCE
ANALYSIS
Avg floor space area respective to the no of entrances to building
6000

5000

4000
Avg floor space area respective to the
no of entrances to building
3000

2000

1000

0
0.5 1 1.5 2 2.5 3 3.5
OFFICES – ENTRANCE
ANALYSIS
Average number of offices corresponding to no of entrances of the
commercial building
4.5

3.5

3
No of Average offices corresponding
to no of entrances
2.5

1.5

0.5

0
0.5 1 1.5 2 2.5 3 3.5
VALUE – OFFICE ANALYSIS
Average Assessed Value of Property with respect to no of offices in
the building
1600

1400
1385
1200 1270 1300
Average Assesed Value

1000 Average Assessed Value of Property

with respect to no of offices in the
800 853 building

600

400

200

0
0.5 1 1.5 2 2.5 3 3.5 4 4.5

No of Offices in the building

CENTRAL TENDENCY AND
DISPERSION OF THE DATA

Assessed Floor Age rate

median 1216.229 3189.924 25.78362 359.8975
mean 1229.373 3215.713 25.60925 452.2214

Standard
498.1514 1305.053 13.36929 272.9148
deviation
NORMAL DISTRIBUTION –
ASSESSED VALUE
Normal Distribution Graph
0
0
0
0
0
0
0
0
0
0
0 20 40 60 80 100 120
NORMAL DISTRIBUTION -
RATE (SQ FT.)
0

0
0 20 40 60 80 100 120
HYPOTHESIS TESTING Multi-Variate Analysis
NULL HYPOTHESIS
H0: Building Characteristics do not have a significant impact on the Assessed Value

 The null hypothesis is the pre-existing condition or statement that is believed to be

true about a situation
 While conducting hypothesis testing, we are tasked with either rejecting or failing
to reject the null hypothesis based on the presence or absence of sufficient evidence
respectively
 In case of multi-variate analysis (Regression), the null hypothesis is accepted
(Failure of rejection) when the p-value is greater than the significance factor
ALTERNATE HYPOTHESES
HA: Building Characteristics have a significant impact on the Assessed Value
HA1: Floor Space has a significant impact on the Assessed Value
HA2: Age of Property has a significant impact on the Assessed Value
HA3: Closeness to Freeway has a significant impact on the Assessed Value
The alternate hypothesis is the condition or relation that we are trying to propose and thus, have the
burden of proving with statistical evidence

 While conducting hypothesis testing, if we happen to reject the null hypothesis, this in turn indicates that
there is sufficient evidence to consider the possibility of the alternate hypothesis holding true

 In case of multi-variate analysis (Regression), the alternate hypothesis is accepted (considered) when the
p-value is smaller than the significance factor
REGRESSION RESULTS
SUMMARY OUTPUT

Regression Statistics
Multiple R 0.390010294
R Square 0.15210803
Adjusted R Square 0.125611405
Standard Error 468.1618584
Observations 100

ANOVA
df SS MS F Significance F
Regression 3 3774634.522 1258211.507 5.740656963 0.001176952
Residual 96 21040850.46 219175.5256
Total 99 24815484.98

Coefficients Standard Error t Stat P-value Lower 95% Upper 95% Lower 95.0% Upper 95.0%
Intercept 913.0548266 167.6859468 5.445028902 3.97562E-07 580.200853 1245.9088 580.200853 1245.9088
Floor 0.13033466 0.037044675 3.518310239 0.000665516 0.056801561 0.203867759 0.056801561 0.203867759
Age -2.226096483 3.556471883 -0.625928324 0.532847317 -9.285637376 4.833444409 -9.285637376 4.833444409
Freeway -101.7607022 98.54528355 -1.032628844 0.304372071 -297.3715441 93.8501396 -297.3715441 93.8501396
REGRESSION ANALYSIS
Based on the regression results we can draw the following inferences:

R Square value of 0.15~ indicates that the model mightw eligible but has low significance

P-Value is lesser than the Significance Factor (α value) - 0.001176952 < 0.05

This indicates that our regression model can be considered for further analysis

Looking at the individual p-values for our independent variables, we see that only one variable
satisfies the condition; Floor Space
FINAL REGRESSION
EQUATION
The final regression equation would look like:

Y ( Assessed Value) = 913.0548266 + 0.13033466 (X, Floor Space)

Since the other 2 independent variables do not have a significant impact on the
assessed value of the property, they would not be included into the regression
equation
CORRELATION

Age Freeway Correlation value ranges between -1 to +1. When the

Age 1 0.174372399 correlation value is closer to 0, it indicates that the
Freeway 0.174372399 1 degree of relation between the 2 variables is low.

Assessed Age A negative correlation value signifies an inverse

Assessed 1 -0.09592162 relation between the 2 variables. On top of that, the
Age -0.09592162 1 value is very close to 0, indicating weak correlation.
INTERPRETATION
Based on the correlation results, we can draw the following inferences:

It would not be possible for us to say that the age of property has any significant
correlation with the property’s closeness to the freeway

Similarly, it would not be possible for us to say that the age of the property has a strong
correlation with the property’s assessed value

Although, it can be said that there is in indication towards an inverse relation which
suggests that older properties have lower value, consistent with the popular belief
 Aaditya Rai

THANK YOU
Akshay Awashank
Pallavi Kumari
Yash Bontalwar
Suvidit Kapoor