TABLE 14-4
A real estate builder wishes to determine how house size (House) is influenced by family income (Income), family size (Size), and education of the head of household (School). House size is measured in hundreds of square feet, income is measured in thousands of dollars, and education is in years. The builder randomly selected 50 families and ran the multiple regression. Microsoft Excel output is provided below:
SUMMARY OUTPUT
Regression Statistics
ANOVA

-Referring to Table 14-4, which of the independent variables in the model are significant at the 2% level?
A) Income, Size, School
B) Income, Size
C) Size, School
D) Income, School

Question

TABLE 14-4
A real estate builder wishes to determine how house size (House) is influenced by family income (Income), family size (Size), and education of the head of household (School). House size is measured in hundreds of square feet, income is measured in thousands of dollars, and education is in years. The builder randomly selected 50 families and ran the multiple regression. Microsoft Excel output is provided below:
SUMMARY OUTPUT
Regression Statistics
  ANOVA
  
-Referring to Table 14-4, which of the independent variables in the model are significant at the 2% level?
A) Income, Size, School 
B) Income, Size 
C) Size, School 
D) Income, School

Quizplus · Accepted Answer

To determine which independent variables are significant at the 2% level, we can look at the "Coefficients" table in the Excel output. The p-value for the coefficients represents the significance level of that variable. If the p-value is less than 0.02, then we can conclude that the variable is significant at the 2% level. 
From the table, we see that the p-value for Income is 0.000, and the p-value for Size is 0.006. Both of these values are less than 0.02, so we can conclude that Income and Size are significant at the 2% level. The p-value for School is 0.203, which is greater than 0.02, so we cannot conclude that School is significant at the 2% level. Therefore, the correct answer is B, which includes only Income and Size as significant variables at the 2% level.

TABLE 14-4 A Real Estate Builder Wishes to Determine How House Size