Business Statistics and Analytics

1. potential employees would perform successfully in a particular position. To help estimate the usefulness of the tests, the director gives both tests to 43 employees that currently hold the position. Table 5 gives the scores of each employee on both tests and indicates whether the employee is currently performing successfully or unsuccessfully in the position. If the employee is performing successfully, we set the dummy variable Group is set equal to 1; if the employee is performing unsuccessfully, we set Group equal to 0. Let x1 and x2 denote the scores of a potential employee on tests 1 and 2.

Perform a discriminant analysis on the data and interpret the result, including the confusion matrix. Include all required steps in assessing the final model. By trial and error, find the threshold, which minimizes prediction relative error.