This case study involves Alumni, which are an important source of revenue for colleges and universities. If administrators could determine the factors that influence increases in the percentage of alumni who make a donation (alumni giving rate), they might be able to implement policies that could lead to increased revenue. Research shows that students who are more satisfied with their contact with teachers are more likely to graduate. As a result, one might suspect that smaller class sizes and lower student-faculty ratios might lead to a higher percentage of satisfied graduates, which in turn might lead to increases in the percentage of alumni who make a donation.
The managerial report should contain such as:
1. Choose the best-fit simple linear regression analysis to develop an estimated equation that could be used to predict the alumni-giving rate.
2. Use the multiple linear regression analysis to develop an estimated regression equation that could be used to predict the alumni-giving rate given the graduation rate, the percentage of classes with fewer than 20 students, and the student-faculty ratio. Is it a better fit compared with your answer in part 1? Any multicollinearity exists?
3. What conclusion and recommendation can you derive from F and t tests in part 2?
4. With the multiple linear regression equation in part 2, what is the alumni-giving rate with graduation rate as 80%, 70% of classes with fewer than 20 students, and student-faculty ratio as 15?
5. Any possible modification you suggest for a better-fit multiple linear regression model? Adding or dropping independent variables? Change to any nonlinear model? Explain your suggestion.
Use the information provided in the attached Excel file.
This response provides guidelines on creating a managerial report using multiple linear regression.