SCENARIO 18-4 You Decide to Predict Gasoline Prices in Different Cities and Cities

question 3

Multiple Choice

SCENARIO 18-4
You decide to predict gasoline prices in different cities and towns in the United States for your term
project.Your dependent variable is price of gasoline per gallon and your explanatory variables are
per capita income, the number of firms that manufacture automobile parts in and around the city, the
number of new business starts in the last year, population density of the city, percentage of local
taxes on gasoline, and the number of people using public transportation.You collected data of 32
cities and obtained a regression sum of squares SSR= 122.8821.Your computed value of standard
error of the estimate is 1.9549.
-Referring to Scenario 18-4, if variables that measure the number of new business starts in the
Last year and population density of the city were removed from the multiple regression model,
Which of the following would be true?

• A) The adjusted will definitely increase.
• B) The adjusted cannot increase.
• C) The coefficient of multiple determination will not increase.
• D) The coefficient of multiple determination will definitely increase.

---

Definitions:

Liabilities

Financial obligations or debts owed by a company to external parties or individuals.

Total Assets

The sum of all current and non-current assets owned by an entity, representing the total resources available for use in operations or to pay liabilities.

Expenses

The outflow of money or assets to another entity as a result of a company's operations or activities intended to generate revenue.

Stockholders' Equity

The residual interest in the assets of a corporation after deducting liabilities, representing owner’s equity in the company.