When Using the T-Statistic in Multiple Regression to Determine If

question 43

Multiple Choice

When using the t-statistic in multiple regression to determine if a variable should be removed:

• A) R² will increase if the variable is removed.
• B) if |t| > 1, the standard error will decrease.
• C) a large number of independent variables is convenient.
• D) if |t| < 1, the standard error will increase.

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Definitions:

Predetermined Overhead Rates

Calculated by dividing the estimated manufacturing overhead costs by an allocation base at the beginning of the period.

Periodic Inventory Systems

An inventory system in which the inventory count is updated and the cost of goods sold is calculated periodically at specific intervals, often manually.

Direct Labor Costs

Direct labor costs are the wages paid to employees who are directly involved in the production of goods or services.

Factory Wages Payable

Liabilities owed by a company for labor costs associated with the manufacturing process that have not yet been paid.