In Testing a Multiple Regression Equation for Statistical Significance, the First

question 25

Multiple Choice

In testing a multiple regression equation for statistical significance, the first step involves

• A) testing the intercept term using a t-test.
• B) using a t-test to examine the significance of the overall equation.
• C) using an F-test to examine the significance of the overall equation.
• D) testing each of the slope coefficients using a t-test.
• E) testing each of the slope coefficients using an F-test.

---

Definitions:

Externalities

Costs or benefits that affect a party who did not choose to incur that cost or benefit, often leading to market failures.

Private Sector

The part of the economy that is run by individuals and companies for profit and is not state controlled.

Transaction Costs

Transaction costs are the expenses incurred in buying or selling goods or services, which can include search and information costs, bargaining costs, and enforcement costs.

Optimal Pigouvian Tax

A tax designed to correct the inefficiencies in a market that experiences externalities, set at a level that equates the marginal social cost of the externality with the marginal social benefit.