BMG 323/03 (BBM023/03) Business Analysis Assignment 2 Question | WOU

Business Case: Clustering and Data Mining

Clustering Data Mining techniques help in putting items together so that objects in the same cluster are more like those in other clusters. Clusters are formed by utilising parameters like the shortest distances, the density of data points, graphs, and other statistical distributions. The technique allows data points to be grouped based on their similarities, forming distinct clusters, essentially allowing you to identify patterns and relationships within a large dataset by organising data into groups with shared characteristics. This analysis method in research is commonly based on statistical data analysis used in varied fields, including pattern recognition, machine learning, insights management in market research, data scrubbing, bioinformatics, and more.

Homestays are one of the most popular and profitable businesses in Malaysia. Many travellers are interested in homestays rather than regular hotels due to the amazing benefits a homestay offers. The simulated case shows a simulated homestay business based on a few selected criteria such as friendly host/neighbourhood, number of days stay, convenience and aesthetics. The cluster and table simulated are shown below.

The new property business owner wasn’t sure how to optimise the location as he intends to lease a few acres of land and houses to start up homestay business. He has collected data clusters and favourable ratings from previous homestay guests, as shown in Figure 1 and Table 1 above.

Question 1

(a) From the data provided, design an appropriate graphical display. Comment on the pattern observed.

Factor Grading

(b) From the list of 6 Locations, select 2 locations randomly. (K=2)

(c) Perform a simple version of market segmentation through Cluster Analysis.

Use K-Means cluster analysis with k=2

Hint: Use Euclidean distance to compute the distance between data points.

[50 Marks]

Predictive Analysis and Regression

Predictive analysis is a comprehensive field that employs data analysis techniques to project future trends and results based on historical data.
Regression analysis is a statistical method that concentrates on identifying the relationship between variables to predict the value of a dependent variable using known independent variables. Essentially, regression is a key tool used to perform predictive analysis.

Question 2

From the case above, the developer surveyed 30 respondents on the rental rate of homestay per day and evaluated the ratings of friendly host/neighbours, convenience and aesthetics (scale of 1/lowest to 10/highest). Based on the survey data, evaluate the following.

Data is posted on Flex learn.

a) Visualise the relationship between each independent variable and with rental rate homestay per day (using appropriate graphs). [15 Marks]

b) Develop a regression model between rental rate with the associated variables of favourable host/neighbours, convenience and aesthetic. Explain
the model. [20 Marks]

c) Develop a precise management summary of the clustering and the business opportunities of the rental rate. [15 Marks]