SCENARIO 13-6
One of the Most Common Questions of Prospective

question 143

Multiple Choice

SCENARIO 13-6
One of the most common questions of prospective house buyers pertains to the cost of heating in dollars (Y) .To provide its customers with information on that matter, a large real estate firm used the following 2 variables to predict heating costs: the daily minimum outside temperature in degrees of Fahrenheit ( X1 ) and the amount of insulation in inches ( X 2 ) .Given below is EXCEL output of the regression model. $$\begin{array}{l}\begin{array} { l r } \hline { \text { Regression Statistics } } \\\hline \text { Multiple R } & 0.5270 \\\text { R Square } & 0.2778 \\\text { Adjusted R Square } & 0.1928 \\\text { Standard Error } & 40.9107 \\\text { Observations } & 20 \\\hline\end{array}\\\end{array}$$
$\begin{array}{lrrrrr}\text { ANOVA }\\\hline&\text { df } & \text { SS } & \text { MS } & F & \text { Significance F }\\\hline\text { Regression } & 2 & 10943.0190 & 5471.5095 & 3.2691 & 0.0629 \\\text { Residual } & 17 & 28452.6027 & 1673.6825 & & \\\text { Total } & 19 & 39395.6218 & & &\end{array}$ 13-22 Multiple Regression $$\begin{array}{l}\begin{array} { l r r r r r r } \hline & \text { Coefficients } &{ \text { Standard Error } } & { \text { t Stat } } & \text { P-volue } & \text { Lower 95\% } & \text { Upper 95\% } \\\hline \text { Intercept } & 448.2925 & 90.7853 & 4.9379 & 0.0001 & 256.7522 & 639.8328 \\\text { Temperature } & - 2.7621 & 1.2371 & - 2.2327 & 0.0393 & - 5.3721 & - 0.1520 \\\text { Insulation } & - 15.9408 & 10.0638 & - 1.5840 & 0.1316 & - 37.1736 & 5.2919 \\\hline\end{array}\\\text { Also } \operatorname { SSR } \left( X _ { 1 } \mid X _ { 2 } \right) = 8343.3572 \text { and } \operatorname { SSR } \left( X _ { 2 } \mid X _ { 1 } \right) = 4199.2672\end{array}$$
-Referring to SCENARIO 13-6, what is your decision and conclusion for the testH0 : $\beta$ 2 = 0 vs.H1 : $\beta$ 2 $\neq$ 0 at the $\alpha$ = 0.01 level of significance?

• A)Do not reject H0 and conclude that the amount of insulation has a linear effect on heating costs.
• B)Reject H0 and conclude that the amount of insulation does not have a linear effect on heating costs.
• C)Reject H0 and conclude that the amount of insulation has a linear effect on heating costs.
• D)Do not reject H0 and conclude that the amount of insulation does not have a linear effect on heating costs.

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Definitions:

Noninvasive Procedure

A medical test or surgery that does not require entering the body or breaking the skin, often used for diagnosis or treatment with minimal recovery time.

Surgical Aseptic Technique

Practices and procedures performed during surgery to minimize infection and maintain sterility throughout the procedure.

Catheter

A Catheter is a flexible tube inserted into the body for the purpose of removing fluids, administering medications, or accessing surgical sites.

Anesthesia

A loss of sensation, particularly the feeling of pain.