Apply Principles of the Multiple Regression Model Building Process A) Model 2 Explains Less of the Variability in Average

question 1

Multiple Choice

Apply principles of the multiple regression model building process.
-A sample of 30 companies was randomly selected for a study investigating what
Factors affect the size of company bonuses. Data were collected on the number of
Employees at the company and whether or not the employees were unionized (1 = yes,
0 = no) . Multiple regression output is shown below for two competing models. Which
Of the following statements is true? $$\begin{array} { l } \underline{\text { Model 1: }} \\\text { Dependent Variable is Average Annual Bonus } \\\\\begin{array} { l r r r r } \text { Predictor } & \text { Coef } & \text { SE Coef } & \text { T } & \text { P } \\\text { Constant } & 347.9 & 872.2 & 0.40 & 0.693 \\\text { Employees } & 0.6547 & 0.1105 & 5.92 & 0.000 \\\text { Union } & 1259.5 & 605.8 & 2.08 & 0.047\end{array} \\\\S = 1631.56 \quad \mathrm { R } - \mathrm { Sq } = 62.48 \quad \mathrm { R } - \mathrm { Sq } ( \mathrm { adj } \mathrm { j } ) = 59.6\% \\\\\underline{ \text { Model 2: } } \\\text { Dependent Variable is Average Annual Bonus } \\\\\begin{array} { l r r r r } \text { Predictor } & \text { Coef } & \text { SE Coef } & \text { T } & \text { P } \\\text { Constant } & - 1241.0 & 982.3 & - 1.26 & 0.218 \\\text { Employees } & 0.8872 & 0.1318 & 6.73 & 0.000 \\\text { Union } & 5253 & 1579 & 3.33 & 0.003\end{array} \\\begin{array} { l l l l l } \text { Emp*Union } & - 0.05424 & 0.02012 & - 2.70 & 0.012\end{array} \\\\S = 1469.91 \quad \mathrm { R } - \mathrm { Sq } = 70.68 \quad \mathrm { R } - \mathrm { Sq } ( \mathrm { adj } ) = 67.2\% \\\end{array}$$

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Definitions:

James-Lange Theory

A hypothesis positing that emotions arise due to physical responses to occurrences.

Two-Factor Theory

A theory in psychology that proposes that emotional experiences arise from a combination of a physiological response and a cognitive interpretation of that response.

Cognitive Activity

Any mental process that involves understanding, processing, and storing information, including perceiving, thinking, and memory.

Autonomic Nervous System

The part of the nervous system that controls involuntary body functions, such as heartbeat, digestion, and breathing.