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For this week's assignment, we will examine pricing of diamonds as a further example

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For this week's assignment, we will examine pricing of diamonds as a further example. The below data are from a major online diamond retailer (https://www.adiamor.com) (Links to an external site.) The candidate determinants of prices are carat size, clarity, color, depth and cut of stone. Consider two NN models for your analysis. In the first NN model, assume the default, one layer three nodes with TanH activation function. In the second, consider the most complex model, two layers and three nodes for all three activation functions. In both cases, construct models with random seed 123 for replication. Rely on the OLS method. Set the random seed for the validation column to 123 as well. Finally, suppose you are on the market for a diamond ring and the one you are looking at has the following: Carat: 1.5, Color: E, Clarity: VS1, Depth: 81 and Cut: Very Good It is on sale for $9,000, should you buy it? PAY ATTENTION TO RUBRIC. 4-5 pages long documents (12 points font, and 1.5 line spacing) 1) Introduction (20 points) - Describe the problem/question - Discuss the data set; response variable of interest and predictors, or any points you would like to mention - Mention the statistical methods you will employ 2) Analysis and Model Comparison (40 points) - Briefly discuss features (advantages/disadvantages, other specifications) of the methods you will employ - Describe the cross-validation procedure that you employ - Briefly outline the analysis you conducted - Report the Model Comparison results and the method you choose 3) Interpretation (40 points) - If a linear model is chosen, report parameter estimates and discuss their implications - Conduct variable importance analysis for your chosen model - Investigate your model’s profilers and interpret them - If the assignment includes a part to make a specific forecast, report your model’s prediction.