The following estimated regression equation was developed relating yearly income (y in $1000s) of 30 individuals with their age (x₁) and their gender (x₂) (0 if male and 1 if female). $\hat { y }$ = 30 + .7x₁ + 3x₂ Also provided are SST = 1200 and SSE = 384.At the 5% level, the model A) is significant. B) is not significant. C) would be significant if the sample size was larger than 30. D) has significant individual parameters.

Question

Quizplus · Accepted Answer

The F-statistic is calculated as:F = (SSE/dfE)/(SST/dfT) = (384/28)/(1200/29) = 4.29The critical F-value with dfE = 28 and dfT = 29 at the 5% level is 3.33. Since the calculated F-statistic (4.29) is greater than the critical value (3.33), we reject the null hypothesis and conclude that the model is significant.

The Following Estimated Regression Equation Was Developed Relating Yearly Income y^\hat { y }y^​

The Following Estimated Regression Equation Was Developed Relating Yearly Income $\hat { y }$