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Multiple Regression using Dummy Variables and Interaction Term - SPSS

Group 15 Click to edit Master subtitle style By: Vaibhav Kumar Varun Sandhu Vibhore Goyal Vikas Yadav

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Drilling

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Two wells were to be drilled 300 feet down, the length of a football field. To drill, they connect the drill bit to one of the long pipes and slowly drill through the ground. Pipes are continually attached as they go deeper. They keep adding pipes until When they reach the end the desired depth is reached of one pipe, another piece with the drill bit on the end. of pipe is connected. During drilling, a balance between bit pressure, water, and air pressure must be maintained to get an

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Dry Drilling ?

t e g W in ll i r D ?
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a) Multiple Regression Equation


Yi= 0 + 1 X1i + 2 X2i Predicted Time = 8.01+ 0.00523.Depth-

2.105.Dry

0 = 8.01 1 = 0.00523
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b) Coefficient Interpretation
0 = 8.01 Represents the mean value of time when depth equals 0. Depth can never be 0, thus interpreting 0 can be

misleading
1 = 0.00523 On holding the effect of type of drilling as constant, for each

foot increase in depth of the hole, the mean drilling time is estimated to increase by 0.0052 min.

2 = -2.105

For a given depth a dry hole is estimated to reduce

mean drilling time over wet drilling by 2.1052 min.


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c) Predict additional drilling time


Depth 100 feet for dry drilling From SPSS data value is found to be 6.428

Confidence Interval Estimate From SPSS data Confidence Interval

Estimate at depth 100 feet is as follows:


6.210<=y|x <= 6.646
Prediction Interval Estimate From SPSS data Prediction Interval Estimate

at depth 100 feet is as follows:

4.932<=X <= 7.932

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d) Residual Analysis for validity


Linearity The condition for linearity is fulfilled as Independence As data was collected during the same time

seen in the residual plot of the SPSS output.

period independence assumption is valid

Normality The histogram and normal plot of residual

valuate the normality assumption

Equal Variance

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e) Significance of Relationship
Level of Significance 0.05
H0 : 1 = 0

H0 : 1 0
F critical for 0.05 level of significance is 3.09 FSTAT = 111.11 > 3.09 Thus reject H0 Valid Relationship

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f) Significance of Relationship
Level of Significance 0.05 H0 : 1 = 0 H0 : 1 0 t critical for 0.05 level of significance is 1.9847 tSTAT = 5.03> 1.9847; Rejects H0

H0 : 2 = 0 H0 : 2 0 t critical for 0.05 level of significance is 1.9847 tSTAT = -14.03< -1.9847;Rejects H0


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g) CIE - Drilling Time and Depth


As observed from the SPSS data 95% Confidence Interval Estimate between additional

drilling time and depth would be given by


0.0032 <= 1 <= 0.0073

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h) CIE - Drilling Time and Hole Type


As observed from the SPSS data 95% Confidence Interval Estimate between additional

drilling time and type of hole would be given by


-2.403 <= 2 <= -1.808

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i) Adjusted R square
As observed from the SPSS data

R square value is 0.690

69% of the variation in time is explained by variation in

depth and type of hole.

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j) Assumption

Slope of additional drilling time with depth of the hole is

same regardless of the type of drilling method used

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k) Interaction Term

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l) Appropriate Model

Model in (a) is a much better and should be

used.

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