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An information technology company that specializes in website development is interested in modeling development time as a function of the contract cost, number of available developers, and number of projects undertaken.
(a) Write down the equation of the model and explain the meaning of the model parameters in the context of the problem.
(b) What signs do you expect of the model parameters? Explain.
(c) Do you suspect multicollinearity (strong relationship) among the independent variables? If so, among which variables? What measures might you take to reduce the impact of multicollinearity?
(d) Suppose you had built a model to predict development time based only on the contract cost. What might be some disadvantages of this model?
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What is the area between the mean and 395 pounds? What is the probability of selecting a value at random and discovering that it has a value of less than 395 pounds
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