Identify the Components of Simple Linear Regression Models and Discuss

question 42

Multiple Choice

Identify the components of simple linear regression models and discuss their applications Use the data given below to answer the following question(s) .
Following is an extract from the database of a construction company. The table shows the height of walls in feet and the cost of raising them. The estimated simple linear regression equation is given as Ŷ = b0 + b1X. (Hint: Use Excel functions) . $$\begin{array} { | l | l | } \hline\begin{array} { l } \text { Height } \\\text { (ft) }\end{array} & \text { Cost (\$) } \\\hline 4 & 670 \\\hline 3 & 430 \\\hline 7 & 810 \\\hline 9 & 1100 \\\hline 6 & 790 \\\hline 8 & 880 \\\hline 5 & 760 \\\hline 11 & 1200 \\\hline\end{array}$$
-Which of the following statements is true when using the Excel Regression tool?

• A) The range for the independent variable values must be specified in the box for the Input Y Range.
• B) Checking the option Constant is Zero forces the intercept to zero.
• C) The Regression tool can be found in the Tools tab under Insert group.
• D) Adding an intercept term reduces the analysis' fit to the data.

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Definitions:

John Maynard Keynes

An influential British economist whose ideas fundamentally changed the theory and practice of macroeconomics and the economic policies of governments.

Expansionary Gap

A situation where actual output in an economy exceeds the potential output, leading to inflationary pressures due to high demand.

Government Spending

The total amount of money that a government allocates and uses on public services and infrastructure.

Real GDP

The measure of a country's economic output adjusted for price changes (inflation or deflation), reflecting the actual value of goods and services produced.