Exhibit 15-3 In a regression model involving 30 observations, the following estimated regression equation was obtained: = 17 + 4x 1 - 3x 2 + 8x 3 + 8x 4 For this model SSR = 700 and SSE = 100. -Refer to Exhibit 15-3. The conclusion is that the A)model is not significant B)model is significant C)slope of x₁ is significant D)slope of x₂ is significant

Question

Quizplus · Accepted Answer

To determine if the model is significant, we need to conduct an F-test. The F-statistic is given by F = (SSR/k) / (SSE/(n-k-1)), where k is the number of independent variables and n is the sample size. 
Plugging in the values, we get F = (700/4) / (100/25) = 43.75. Using a significance level of 0.05, and degrees of freedom of (4, 25), we find the critical F-value to be 2.87. Since our calculated F-value is greater than the critical F-value, we reject the null hypothesis and conclude that the model is significant. 
We cannot determine the significance of individual slopes based on just their coefficients. We would need to conduct t-tests for each coefficient to determine their significance.

Exhibit 15-3 In a Regression Model Involving 30 Observations, the Following Estimated