TABLE 14-5 A Microeconomist Wants to Determine How Corporate Sales Are Influenced

question 127

Multiple Choice

TABLE 14-5
A microeconomist wants to determine how corporate sales are influenced by capital and wage spending by companies. She proceeds to randomly select 26 large corporations and record information in millions of dollars. The Microsoft Excel output below shows results of this multiple regression.
SUMMARY OUTPUT
Regression Statistics
ANOVA

-Referring to Table 14-5, at the 0.01 level of significance, what conclusion should the microeconomist draw regarding the inclusion of Capital in the regression model?

• A) Capital is significant in explaining corporate sales and should be included in the model because its p-value is less than 0.01.
• B) Capital is significant in explaining corporate sales and should be included in the model because its p-value is more than 0.01.
• C) Capital is not significant in explaining corporate sales and should not be included in the model because its p-value is less than 0.01.
• D) Capital is not significant in explaining corporate sales and should not be included in the model because its p-value is more than 0.01.

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Definitions:

Sale-On-Approval Contracts

Contracts that allow buyers to take possession of goods before deciding whether to complete the purchase, often used in sales where inspection is necessary.

Condition-Or-Sale Contracts

Agreements that stipulate the sale of goods is dependent on certain conditions being met, often used to protect the interests of the seller.

UCC

The Uniform Commercial Code, a set of laws that govern commercial transactions in the United States.

Simple Delivery Contract

An agreement where goods are transferred directly from the seller to the buyer without any special conditions or requirements.