Interpret Multiple Regression Output A) the Indicator Variable in the Model Is Not Significant

question 3

Multiple Choice

Interpret multiple regression output.
-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) . The multiple regression output including a plot of residuals versus fitted values
Is shown below. Based on the results shown, which of the following statements is true? Dependent Variable is Average Annual Bonus

$\begin{array} { l r r r r } \text { Predictor } & \text { Coef } & \text { SE Coef } & \text { T } & \text { P } \\ \text { Constant } & - 1241.0 & 982.3 & - 1.26 & 0.218 \\ \text { Employees } & 0.8872 & 0.1318 & 6.73 & 0.000 \\ \text { Union } & 5253 & 1579 & 3.33 & 0.003 \\ \text { Emp*Union } & - 0.05424 & 0.02012 & - 2.70 & 0.012 \end{array}$

• A) The indicator variable in the model is not significant.
• B) The interaction term in the model is not significant.
• C) The indicator variable in the model is significant.
• D) The interaction term should be dropped from the model.
• E) None of the above.