DATA ANALYSIS I
FUNCTIONS & DESCRIPTIVE STATISTICS
I. FUNCTIONS (Barnett, Chapter 1)
A. INDEPENDENT (input) VS. DEPENDENT (output) VARIABLES:
1. Examples:
a. The effect of Price on Quantity of Items sold:
b. The carrying/book value of an asset as time passes:
B. LINEAR FUNCTIONS - OVERVIEW:
1. The Equation:
a. slope: “RISE OVER RUN”
b. y intercept: THE VALUE OF Y WHEN X EQUALS 0
c. x intercept: THE VALUE OF X WHEN Y EQUALS 0
C. WORKING WITH LINEAR FUNCTIONS:
1. Estimating the Equation Model – Simple Example:
You want to analyze the relationship between advertising expenditures
sales. You have been given the following information:
Month Advertising
Expenditures
Sales
May $ 6,000 $18,000
June $ 2,000 $10,000
July $ 4,000 $14,000
a. The Function:
b. The Slope:
c. The Y Intercept:
d. The X Intercept:
e. The Equation:
f. The Graph:
y
x
2. Projections using the......
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