A P-Value of 1% for the Intercept Term in a Regression

question 94

Multiple Choice

A p-value of 1% for the intercept term in a regression of a cost driver against a cost indicates:

• A) The true fixed costs are statistically significantly different from zero
• B) There is only a 1% chance the true fixed costs are zero
• C) The variable costs are immaterial in this cost function
• D) Both (a) and (b)

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