When should a left-tailed significance test be used? A)When economic theory suggests the coefficient should be positive B)When it allows you to reject the null hypothesis at a lower p-value C)When economic theory suggests the coefficient should be negative D)When you know the true value of $\beta$₂ is positive.

Question

Quizplus · Accepted Answer

A left-tailed significance test should be used when economic theory suggests the coefficient should be negative. This is because the left tail of the distribution represents negative values, and rejecting the null hypothesis in favor of a negative coefficient indicates that the variable has a negative impact on the outcome being measured.

When Should a Left-Tailed Significance Test Be Used? A)When Economic β\betaβ

When Should a Left-Tailed Significance Test Be Used?
A)When Economic $\beta$