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 1 ), the amount of insulation in inches ( X 2 ), the number of windows in the house ( X 3 ), and the age of the furnace in years ( X 4 ). Given below are the EXCEL outputs of two regression models.

-Referring to Scenario 18-1,which of the following values for the level of significance is the smallest for which the regression model as a whole is significant?
A)0.0005
B)0.001
C)0.01
D)0.05

Question

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 1 ), the amount of insulation in inches ( X 2 ), the number of windows in the house ( X 3 ), and the age of the furnace in years ( X 4 ). Given below are the EXCEL outputs of two regression models.

-Referring to Scenario 18-1,which of the following values for the level of significance is the smallest for which the regression model as a whole is significant?
A)0.0005 
B)0.001 
C)0.01 
D)0.05

Quizplus · Accepted Answer

The smallest level of significance for which the regression model as a whole is significant indicates the highest level of confidence in the model's significance. A value of 0.0005 is the smallest among the options, implying the highest confidence and thus the smallest level of significance for which the model is considered significant.

SCENARIO 18-2 One of the Most Common Questions of Prospective House Buyers