Sol & Nieve is a sporting good and outdoor gear retailer that operates in North America and Central America. In an attempt to characterize its stores and reassess Sol & Nieve’s supply chain operations, Gustavo Esposito is analyzing sales in 22 regions for its two primary product lines: sol (beach-oriented apparel) and nieve (mountain-oriented apparel). For a range of k values, Gustavo has generated the following table of average silhouette values and elbow chart. After examining this output, Gustavo also generated the following scatter charts for the clusters correspond to k = 2, 3, and 4.

a. What value of k is the most appropriate for these data?

b. For the value of k identified in part (a), how should Gustavo interpret the results to characterize the sales regions?

Transcribed Image Text:

k Average Silhouette Value 2 0.741 3 0.779 4 0.837 56 0.667 0.401 7 0.433 8 0.502 9 0.536 10 0.494