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Refer to Cosmetics sales Problem 10.13. Given below are the estimated ridge standardized regression coefficients, the variance inflation factors, and R2 for selected biasing constants c.
a. Make a ridge trace plot for the given c values. Do the ridge regression coefficients exhibit substantial changes near c = 0'1
b. Suggest a reasonable value for the biasing constant c based on the ridge trace, the VIF values, and R2.
c. Transform the estimated standardized regression coefficients selected in part (b) back to the original variables and obtain the fitted values for the 44 cases. How similar are these fitted values to those obtained with the ordinary least squares fit in Problem 1O.13a?
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