Monday, February 18, 2013

Econometric Project on Diamonds

Sacha Froelich
ECO 4421.001
Project Diamond
December 2, 2011

Research Questions:
When viewing diamonds, how is price primed(p)? The typical response is the 4 Cs (carat, color, clarity, and cut). I want to see how accurate and important the carat, color, and clarity argon in determining price. Ideally, I wanted to bring into bring in the reliability of different Gemmological grading but as I couldnt find entropy that allowed for direct comparison utilise the same group of diamonds, I had to go with this modified prodigy of diamond prices instead.

Dataset Description:
N = 180 observations
Y = Price, in dollars
X1 = karat, weight/size of a diamond with 1 Carat = 0.2 grams; my range being 0.5 to 1.01 Carats
X2 = Color, which will be further abject down into: D=1, E=2, F=3, G=4, H=5, and I=6
X3 = Clarity, again broken into: 1IF=18, 2VVS1=19, 3VVS2=21, 4VS1=22, and 5VS2=23 (these values were railroad car generated by STATA as 1-6 were already taken (Im crack from my Clarity) it originally gave me 7-11 but as I had to tweak the articulate in which they appeared because it kept taking it alphabetically which threw off my scale, thitherfrom the 1IF vs.

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IF each new batch gave a numerical subsidisation that went further down the pike which is how I/STATA arrived at the poem given)

The data was used as part of Statistix 9.0 software when I took Stats II in Spring of 2011 and originally was published in Singapores Business Times edition on February 18, 2000. I have taken a portion of it here for my use. I attempted to find more current data but couldnt locate anything that was free. See: http://www.amstat.org/publications/jse/jse_data_archive.htm

My stupefy:
I would assume that the Multiple Linear Regression (MLR) would be the best model. I do propose that Price is hooklike upon the Carat size, Color, and Clarity. I do expect to see a strong positive relationship between these variables and the price. Although, I do believe that Cut is also a deciding factor, it wint...If you want to get a full essay, order it on our website: Orderessay



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