TABLE 14-3
An economist is interested to see how consumption for an economy (in $ billions) is influenced by gross domestic product ($ billions) and aggregate price (consumer price index). The Microsoft Excel output of this regression is partially reproduced below.
-Referring to Table 14-3, to test whether aggregate price index has a negative impact on consumption, the p-value is
A) 0.0001.
B) 0.4165.
C) 0.8330.
D) 0.8837.

Question

TABLE 14-3
An economist is interested to see how consumption for an economy (in $ billions) is influenced by gross domestic product ($ billions) and aggregate price (consumer price index). The Microsoft Excel output of this regression is partially reproduced below. 
-Referring to Table 14-3, to test whether aggregate price index has a negative impact on consumption, the p-value is
A) 0.0001. 
B) 0.4165. 
C) 0.8330. 
D) 0.8837.

Quizplus · Accepted Answer

The p-value for the coefficient of aggregate price is 0.4165, which is not statistically significant at the conventional 5% level (p-value > 0.05). Therefore, we cannot reject the null hypothesis that aggregate price index has no effect on consumption, or in other words, there is no evidence to suggest that changes in aggregate price index have a negative impact on consumption.

TABLE 14-3 an Economist Is Interested to See How Consumption for an for an Economy