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2: The car dealership is seeking to predict whether a car will be purchased or not based upon the collected data. The dealership wants to
2: The car dealership is seeking to predict whether a car will be purchased or not based upon the collected data. The dealership wants to perform a logistic regression analysis to perform the prediction. a) Does the data set appear suitable for this type of analysis? Evidence your answer with reference to whether the data set meets the logistic regression assumptions/pre- conditions. You may use screenshots of charts/graphs, and tables from SPSS to support your argument. (20 marks) b) For a logistic regression model, which variables would you choose as predictor variables? For a model with those variables, which predictor variable has the greatest effect on the prediction? Justify your answers. (8 marks) c) For your chosen predictor variables, state the logistic regression equation that determines the probability that a car will be purchased . How is this probability value used to predict whether a car will be purchased? (10 marks) d) A 56-year-old male with an annual salary of 60,000 enters the car dealership. Using the equation in part 2c and a classification threshold (cut-off) value of 0.45, determine whether they are predicted to purchase a car. Show how you made the prediction (i.e., show your workings). (10 marks) e) What is the accuracy of the logistic regression model derived above and is the model statistically significant? Justify your answer. Interpret the Nagelkerke R2 value for the model. Explain whether you would consider the model to be robust. as
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