Page 270 - DMGT209_QUANTITATIVE_TECHNIQUES_II

Unit 14: Multivariate Analysis

MDS solution. When the results are mapped in two dimensions, the solution will reproduce a Notes
conventional map, except that the MDS plot might need to be rotated so that the north-south and
east-west dimensions conform to expectations. However, the once the rotation is completed, the
configuration of the cities will be spatially correct.

Task Which technique would you use to measure the joint effect of various attributes
while designing an automobile loan and why?

Self Assessment

Fill in the blanks:

11. When the objective is to summarise information from a large set of variables into fewer
factors, ....................... analysis is used.
12. The ....................... is a part-worth or utility for each level of each attribute.

14.6 Summary

 Multivariate analysis is used if there are more than 2 variables.
 Some of the multi variate analysis are discriminant analysis, Factor analysis, Cluster
analysis, conjoint analysis, and multi dimensional scaling.
 In discriminant analysis, it is verified whether the 2 groups differ from one another.
 Factor analysis is used to reduce large no of various factors into fewer variables cluster
analysis is used to segmenting the market or to identify the target group.

 MDS as a set of multivariate statistical methods for estimating the parameters in and
assessing the fit of various spatial distance models for proximity data.
 The output of MDS looks very similar to that of factor analysis and the determination of
the optimal number of dimensions is handled in much the same way.

14.7 Keywords

Cluster analysis: Cluster Analysis is a technique used for classifying objects into groups.
Discriminant analysis: In this analysis, two or more groups are compared. In the final analysis,
we need to find out whether the groups differ one from another.
Multivariate analysis: In multi variate analysis, the number of variables to be tackled are
many.

14.8 Review Questions

1. Do you think that the conjoint analysis will be useful in any manner for an airline? If yes
how, if no, give an example where you think the technique is of immense help.
2. In your opinion, what are the main advantages of cluster analysis?
3. Which analysis would you use in a situation when the objective is to summarise information
from a large set of variables into fewer factors? What will be the steps you would follow?
4. Which analysis would answer if it is possible to estimate the size of different groups?
5. Which analysis would you use to compare a good, bad and a mediocre doctor and why?
6. Analyse the weakness of principle component factor analysis.

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