Exhibit 15-7.A manager at a local bank analyzed the relationship between monthly salary (y,in $)and length of service (x,measured in months)for 30 employees.She estimates .The following table summarizes a portion of the regression results: Refer to Exhibit 15-7.Which of the hypotheses will determine whether the intercept differs from zero?

Question

Exhibit 15-7.A manager at a local bank analyzed the relationship between monthly salary (y,in $)and length of service (x,measured in months)for 30 employees.She estimates  .The following table summarizes a portion of the regression results:  Refer to Exhibit 15-7.Which of the hypotheses will determine whether the intercept differs from zero?

Quizplus · Accepted Answer

The null hypothesis for testing if the intercept differs from zero is H0: β0 = 0. Therefore, we need to look at the t-test for β0, which is shown in the "Coefficients" table. In this case, the t-value for β0 is -2.04, and the corresponding p-value is 0.050. Since the p-value is greater than the significance level of 0.05, we fail to reject the null hypothesis and conclude that there is insufficient evidence to suggest that the intercept differs from zero.