Answer to Question #165185 in Statistics and Probability for Sunny

Question

A popular confectionary brand manufacturing "dips and salad dressings" wants to understand what should be the value proposition that it should use to position itself in the minds of consumers. The company asked the respondents to rate Thousand Island dressing on the following parameters and run factor analysis to come up with a solution:

V1 Authentic

V2 Nutritious

V3 Healthy

V4 Good Ingredients

V5 Tangy

V6 Sweet and Sour

V7 Tasty

V8 Expensive

V9 Economical

The output factor analysis is presented below:

KMO and Bartlett's Test

Kaiser - Meyer - Olkin Measure of sampling .888

Adequacy

Bartlett"s Test of Approx. chi - square 800. 400

Sphericity Df 36

sig .000

Total Variance Explained

Intial Eigenvalues Extraction sums of squared loadings

component Total % of variance cumlulative % Total % of variance cumulative%

1 3.066 30.067 30.067 3.066 30.067 30.067

2 2.021 26.451 56.517 2.021 26.451 56.517

3 1.209 16.436 72.953 1.209 16.436 72.953

4 .679 7.548 77.501

5 .585 6.498 83.999

6 .493 5.481 89.480

7 416 4.623 94.103

8 .303 3.368 97.471 .

9 .228 2.529 100.000

Rotated Component Matrix

Component

1 2 3

V3 865 -230 .020

V4 778 200 .080

V6 .080 .804 .170

V8 .040 .054 -8.53

V9 .119 .209 .762

V2 880 -.128 -.001

V1 .858 -.118 .026

V5 -.120 .771 -.076

V7 -.160 .775 .095

Extraction Method: Prinicipal Component Analysis.

Rotation Method: Varimax with Kaiser

Normalization.

Rotation converged in 4 iterations.

Based on the above output tables, answer the following questions:

a. does the factor analysis give significant results? interpret KMO and Bartlett's.

b. Based on eigen values how many factors are emerging?

c. what percentage of variation is explained by those factors?

d. what are the variables better represented by each factor?

e. identify the surrogate variable for each other

f. give a suitable name to the factors

Answer 1

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