A sample of General Mills employees was studied to determine their degree of satisfaction with their present life. A special index, called the index of satisfaction, was used to measure satisfaction. Six factors were studied: age at the time of first marriage (X₁), annual income (X₂), number of children living (X₃), value of all assets (X₄), status of health in the form of an index (X₅), and the average number of social activities per week (X₆). Suppose the multiple regression equation is: Y' = 16.24 + 0.017X₁+ 0.00028X₂+ 42X₃+ 0.0012X₄+ 0.09X₅+ 26.8X₆. Explain the meaning of b₂. A) For each additional$1,000 of annual income, their satisfaction index is expected to increase by 0.28 points. B) For each additional$1,000 of annual income, their satisfaction index is expected to increase by 2.8 points. C) For each additional$1,000 of annual income, their satisfaction index is expected to increase by 28 points. D) For each additional living child, their satisfaction index is expected to increase by 42 points. E) For each additional living child, their satisfaction index is expected to increase by 4.2 points.

Question

Quizplus · Accepted Answer

The coefficient 0.00028 for annual income in the regression equation indicates that for each additional dollar of annual income, the satisfaction index increases by 0.00028 points. Therefore, for each additional $1,000, it increases by 0.28 points (0.00028 * 1000 = 0.28).

A Sample of General Mills Employees Was Studied to Determine