Exhibit 15-8 The Following Estimated Regression Model Was Developed Relating Yearly Income

question 70

Multiple Choice

Exhibit 15-8
The following estimated regression model was developed relating yearly income (Y in $1,000s) of 30 individuals with their age (X₁) and their gender (X₂) (0 if male and 1 if female) . Also provided are SST = 1,200 and SSE = 384.
-Refer to Exhibit 15-8. The yearly income of a 24-year-old male individual is

• A)$13.80
• B)$13,800
• C)$46,800
• D)$49,800

---

Definitions:

Bank Capital

The resources a bank’s owners have put into the institution

Total Assets

The sum of all monetary values of everything a company owns, including cash, investments, property, and other resources, reflected on its balance sheet.

Reserve Requirements

The fraction of deposits that banks are required by law to keep on hand or with the central bank as a safeguard against bank runs.

Money Multiplier

A factor that quantifies the amount of money that banks generate with each unit of reserves.