Bob White Is Conducting Research on Monthly Expenses for Medical

question 20

Essay

Bob White is conducting research on monthly expenses for medical care,including over the counter medicine.His dependent variable is monthly expenses for medical care while his independent variables are number of family members and insurance type (government funded,private insurance and other).He has coded insurance type as the following:
X₂ = 1 if government funded,X₃ = 1 if private insurance
Below is his Excel output. (a)What is the prediction equation?
(b)Based on the significance F-test,is this model a good prediction equation?
(c)What percent of the variation in medical expenses is explained by the independent variables?
(d)Based on his model,what are the predicted monthly expenses for a family of four with private insurance?
(e)Based on his model,what are the predicted monthly expenses for a family of two with government funded insurance?
(f)Based on his model,what are the predicted monthly expenses for a family of five with no insurance?

Understand how price acts as a rationing mechanism in free markets and the efficiency of this process.

Examine the unintended effects of economic policies, including price controls.

Realize the role of policymakers in influencing market outcomes through regulations like taxes and minimum-wage laws.

Identify and explain the mechanisms through which price controls are intended to protect consumers or producers.

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Definitions:

Variable Overhead Efficiency Variance

The difference between the actual and expected (or standard) use of variable overheads based on the actual activity levels.

Variable Manufacturing Overhead

The portion of manufacturing overhead costs that varies directly with the level of production, such as utility costs for machinery.

Particular Product

Refers to a specific item or product line that a company manufactures or sells.

Variable Overhead Rate Variance

The difference between the actual variable overhead incurred and the expected variable overhead, based on a predetermined rate.