Linear Regression Lab


We have a lot to do today, so leave the "For Discussion" until you have completed the other portions.

Stock Market Data Go to ASULearn and to the personal file storage space. Click on View Single, and then the various numbers until you find your stock file. Download the file by clicking on the filename. Open Excel and then open your file using File/Open (yournamesotckname.xls).

Does Date predict Close? Click on the grey box above the Date data. The column will become highlighted. Click the apple key at the bottom left of the keyboard, hold this down and then click on the grey box above the Close data. Now both columns will be highlighted. Under Insert, release on Chart. Click on XY (Scatter) and then on Finish. Under Chart, at the top of the monitor, release on Add Trendline... Click on Options (on the top right), and then click on the bottom two options (Display equation on chart, Display r-squared value on chart). Click on OK. Back on the chart, click on the equation of the line, hold down and drag it to the corner so that you can read the info.
  1. Is the trend an upward trend, downward trend, or horizontal trend?

  2. What is the R2 value written as a percent?

  3. What kind of predictor is Date of Close? Use How Do You Know and the R2 value to answer this.

  4. For Discussion (Leave Until Later) If your r2 value was 99.9%, would you be assured to make money in the stock market by using the line to predict the future performance and investing accordingly? Explain by referring to the related Stock Market readings from the past.






    Does Volume predict High? Repeat the above Excel process for the Volume/High columns.
  5. What is the R2 value written as a percent?

  6. What kind of predictor is Volume of High?

  7. Lack of a Trend For most stocks, Volume will be a weak or no predictor of High. Take out your Excel chart from the stock packet and look for contradictions to a general trend between Volume (the bars at the bottom) and High (the top of the stuff at the top). Ie find two consecutive days where the volume increases over time as the high increases, and two other consecutive days where the volume increases over time as the high decreases, or find some other similar information that would contradict a good fitting line relating volume and high. Review your hw reading and apply the same reasoning here. Explain what you found and relate this to your knowledge of predictors to explain why Volume is a poor predictor of high.






    Class Data From the class highlights page, go to this lab, and then click on this Class Data Excel File.

    Does Armspan predict Height? Follow the above Excel process for the Armspan and Height data.
  8. What is the equation of the regression line that Excel gives you?

  9. What is the R2 value written as a percent?

  10. What kind of predictor is Armspan of Height?

  11. Take a look at this graph. What is the r2 value written as a percent?

  12. This is the same data, but I removed some problem points that contradicted the related text that accompanied Leonardo da Vinci's Vitruvian Man: "The length of a man's outspread arms is equal to his height."
    As a researcher, is it ethical to remove these points? Why or why not?






  13. For Discussion (Leave Until Later) Using your knowledge of linear regression lines and predictors, explain why the removal of the problem points has such a huge effect on the r2 value. Be sure to address what it is the r2 value measures and relate this to your answer.