Solved

SCENARIO 18-2
One of the Most Common Questions of Prospective β\beta

Question 293

Multiple Choice

SCENARIO 18-2
One of the most common questions of prospective house buyers pertains to the cost of heating in dollars (Y) . To provide its customers with information on that matter, a large real estate firm used the following 4 variables to predict heating costs: the daily minimum outside temperature in degrees of Fahrenheit ( X1 ) , the amount of insulation in inches ( X 2 ) , the number of windows in the house ( X3 ) , and the age of the furnace in years ( X 4 ) . Given below are the EXCEL outputs of two regression models.
SCENARIO 18-2 One of the most common questions of prospective house buyers pertains to the cost of heating in dollars (Y) . To provide its customers with information on that matter, a large real estate firm used the following 4 variables to predict heating costs: the daily minimum outside temperature in degrees of Fahrenheit ( X<sub>1</sub> ) , the amount of insulation in inches ( X <sub>2</sub> ) , the number of windows in the house ( X<sub>3</sub> ) , and the age of the furnace in years ( X <sub>4</sub> ) . Given below are the EXCEL outputs of two regression models. -Referring to Scenario 18-2 and allowing for a 1% probability of committing a type I error,what is the decision and conclusion for the test H<sub>0 </sub>: \beta <sub>1 </sub>= \beta <sub>2 </sub>= \beta <sub>3 </sub>= \beta <sub>4 </sub>= 0 vs.H<sub>1 </sub>: At least one \beta <sub>j </sub> \neq 0, j = 1,2,...,4 using Model 1? A) Do not reject H<sub>0</sub> and conclude that the 4 independent variables have significant individual linear effects on heating costs. B) Reject H<sub>0</sub> and conclude that the 4 independent variables taken as a group have significant linear effects on heating costs. C) Do not reject H<sub>0</sub> and conclude that the 4 independent variables taken as a group do not have significant linear effects on heating costs. D) Reject H<sub>0</sub> and conclude that the 4 independent variables taken as a group do not have significant linear effects on heating costs.
SCENARIO 18-2 One of the most common questions of prospective house buyers pertains to the cost of heating in dollars (Y) . To provide its customers with information on that matter, a large real estate firm used the following 4 variables to predict heating costs: the daily minimum outside temperature in degrees of Fahrenheit ( X<sub>1</sub> ) , the amount of insulation in inches ( X <sub>2</sub> ) , the number of windows in the house ( X<sub>3</sub> ) , and the age of the furnace in years ( X <sub>4</sub> ) . Given below are the EXCEL outputs of two regression models. -Referring to Scenario 18-2 and allowing for a 1% probability of committing a type I error,what is the decision and conclusion for the test H<sub>0 </sub>: \beta <sub>1 </sub>= \beta <sub>2 </sub>= \beta <sub>3 </sub>= \beta <sub>4 </sub>= 0 vs.H<sub>1 </sub>: At least one \beta <sub>j </sub> \neq 0, j = 1,2,...,4 using Model 1? A) Do not reject H<sub>0</sub> and conclude that the 4 independent variables have significant individual linear effects on heating costs. B) Reject H<sub>0</sub> and conclude that the 4 independent variables taken as a group have significant linear effects on heating costs. C) Do not reject H<sub>0</sub> and conclude that the 4 independent variables taken as a group do not have significant linear effects on heating costs. D) Reject H<sub>0</sub> and conclude that the 4 independent variables taken as a group do not have significant linear effects on heating costs.
-Referring to Scenario 18-2 and allowing for a 1% probability of committing a type I error,what is the decision and conclusion for the test H0 : β\beta 1 = β\beta 2 = β\beta 3 = β\beta 4 = 0 vs.H1 : At least one β\beta j ≠\neq 0, j = 1,2,...,4 using Model 1?


A) Do not reject H0 and conclude that the 4 independent variables have significant individual linear effects on heating costs.
B) Reject H0 and conclude that the 4 independent variables taken as a group have significant linear effects on heating costs.
C) Do not reject H0 and conclude that the 4 independent variables taken as a group do not have significant linear effects on heating costs.
D) Reject H0 and conclude that the 4 independent variables taken as a group do not have significant linear effects on heating costs.

Correct Answer:

verifed

Verified

Unlock this answer now
Get Access to more Verified Answers free of charge

Related Questions

Q288: SCENARIO 18-3<br>A financial analyst wanted to examine

Q289: SCENARIO 18-12<br>The marketing manager for a

Q290: SCENARIO 18-2<br>One of the most common questions

Q291: SCENARIO 18-9<br>What are the factors that determine

Q292: SCENARIO 18-12<br>The marketing manager for a nationally

Q294: Four surgical procedures currently are used

Q295: SCENARIO 18-12<br>The marketing manager for a nationally

Q296: SCENARIO 18-12<br>The marketing manager for a nationally

Q297: SCENARIO 18-12<br>The marketing manager for a nationally

Q298: SCENARIO 18-12<br>The marketing manager for a nationally