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MKT 402: Individual Assignment 2

This is an exercise on hypothesis testing, factor analysis and cluster analysis.

Please download the data “Movie Preference.csv”. The variables included are:

· Column 1: StudentId (respondent identification number, 1, 2, 3, …)

· Column 2: Master (=1 if a master student, =0 if an undergraduate student)

· Column 3: Female (=1 if a female: =0 if a male)

· Column 4: Foreign (=1 if from a foreign country, =0 if from US)

· Columns 5-11: importance rating on the 7 movie attributes (with a 7-point scale where 1 means not important at all and 7 means highly important)

M1: I can relate to the characters

M2: The movie is visually pleasing

M3: Set and costume-design are an important part of a movie

M4: Movie features major stars

M5: Movie has first-rate special effects

M6: Engaging story-line

M7: I feel “transported” while watching

1. Run the factor analysis on the importance rating of the 7 movie attributes (M1-M7)

a. Based on the “eigenvalue >1” criterion, how many factors would you extract? Include the R output to support your choice.

b. Report the factor loadings. Please give meanings to the factors and provide your reasoning.

c. Save the factor scores as extra columns to the movie preference dataset, and draw a map of all the respondents based on their factor scores on the two most important factors (i.e. a perceptual map of all the respondents).

2. Run the K-means clustering on the factor scores obtained from 1c, to create three clusters. Please set R random seed before you run clustering analysis using “set.seed(12345)”. 

a. Save the cluster indicator as an extra column to the movie preference dataset. How many respondents are classified into each of the three clusters? Provide the R output.

b. Which factor(s) are the important ones in forming the three clusters? Provide the R output as your support.

c. Describe the differences between the three clusters on the important factors identified in 2b. Please describe the characteristics of each cluster and provide your reasoning. Provide the R output as your support.

3. Please select a proper test to test the following:

a. Whether the cluster indicator correlates with whether a respondent is undergraduate or master student. Please specify H0 and H1, and report your test results, conclusions and reasoning.

b. For each of the important factor(s) identified in 2b, whether it is significantly different between female and male students. Please specify H0 and H1, and report your test results, conclusions and reasoning.

· Please submit your answers in one word file and codes in a separate r file before 3/9 (Monday).