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A Regression Was Performed on a Sample of 16 Observations β\beta

Question 9

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A regression was performed on a sample of 16 observations. The estimated equation is A regression was performed on a sample of 16 observations. The estimated equation is . The standard errors for the coefficients are S<sub>b1</sub> = 4.2, S<sub>b2</sub> = 5.6, and S<sub>b3</sub> = 2.8. For this model, SST = 3809.6 and SSR = 3285.4. a.Compute the appropriate t ratios. b.Test for the significance of \beta <sub>1</sub>, \beta <sub>2</sub>and \beta <sub>3</sub>at the 5% level of significance. c.Do you think that any of the variables should be dropped from the model? Explain. d.Compute R<sup>2</sup> and R<sub>a</sub><sup>2</sup>. Interpret R<sup>2</sup>. e.Test the significance of the relationship among the variables at the 5% level of significance. . The standard errors for the coefficients are Sb1 = 4.2, Sb2 = 5.6, and Sb3 = 2.8. For this model, SST = 3809.6 and SSR = 3285.4.
a.Compute the appropriate t ratios.
b.Test for the significance of β\beta 1, β\beta 2and β\beta 3at the 5% level of significance.
c.Do you think that any of the variables should be dropped from the model? Explain.
d.Compute R2 and Ra2. Interpret R2.
e.Test the significance of the relationship among the variables at the 5% level of significance.

Correct Answer:

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a.t1 = -3.4, t3 = 1.2, t3 = 5.6
b.t.025 = 2.179...

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