Perform an F-Test for Lack of Fit
-When Performing a Multiple

question 81

Multiple Choice

Perform an F-test for Lack of Fit
-When performing a multiple linear regression, if we test the null hypothesis that the coefficients are all zero, what is the decision rule?

• A) If \(\mathrm { p } < \alpha\), then reject the null hypothesis.
• B) If \(p > \alpha\), then reject the null hypothesis.
• C) If \(\mathrm { p } < \alpha\), then fail to reject the null hypothesis.
• D) If \(p > \alpha\), then fail to reject the alternative hypothesis.

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Definitions:

Discount Rate

In finance, it's the interest rate the Federal Reserve charges banks for borrowing funds, used to control money supply.

Net Present Value

A method used in finance to assess the profitability of an investment by calculating the present value of its expected future cash flows minus the initial investment cost.

Investment

The action of allocating resources, usually money, with the expectation of generating an income or profit.

Interest Rate

The percentage of a sum of money charged for its use, often expressed as an annual percentage on loans or earned on savings.