Exhibit 13-7
A regression model involving 4 independent variables and a sample of 15 periods resulted in the following sum of squares.
SSR = 165
SSE = 60
-Refer to Exhibit 13-7. If we want to test for the significance of the model at 95% confidence, the critical F value from the table) is
A) 3.06
B) 3.48
C) 3.34
D) 3.11

Question

Quizplus · Accepted Answer

The F-statistic is calculated using the formula F = (SSR/df1) / (SSE/df2), where df1 = number of independent variables = 4, and df2 = n - k - 1 = 15 - 4 - 1 = 10. The F-statistic is then compared to the critical F value at 95% confidence level with df1 = 4 and df2 = 10, which is 3.48.

Exhibit 13-7 A Regression Model Involving 4 Independent Variables and a Sample