Angela Chou Has Been Asked to Investigate the Determinants of Poverty

question 57

Multiple Choice

Angela Chou has been asked to investigate the determinants of poverty in Ontario communities.
She collected data on 60 communities from Statistics Canada. She selected the percentage of poor
Persons living under the poverty line [Poor (%) ], measured by Low Income Cut-Off, designed by
Statistics Canada as a measure of poverty for a community, as the dependent variable. The
Independent variables selected are percent of single families in each community, the
Unemployment rate in each community, percent of population in the community holding a bachelor's
Degree as their highest level of education attained, and percent of population holding a High
School Diploma as their highest level of education attained.
Given the regression equation Poor (%) = -3.81 + 0.798 Single-Families (%) + 0.624 Unemployment
Rate (%) - 0.170 Bachelor's Degree (%) - 0.003 High School (%)
Interpret the numbers 3.81 and 0.798.

• A) As the % of Single Families in an Ontario community increases, the % of poor families increase as well, with a maximum of 3.81% of the population being poor.
• B) As the % of Single Families in an Ontario community increases, the % of poor families decrease.
• C) There are 3.81% poor families and 0.798 Single-Families in Ontario communities.
• D) 3.81 is the y-intercept. When all of the dependent variables have a value of zero, we can expect that 3.81% of the community to be poor. 0.789 indicates that for an extra 0.789% of
• Poor families in a community, we can expect that the % of single families will increase by
• 1%)
• E) When all of the independent variables have a value of zero, we can expect that -3.81% of the community to be poor, i.e. 0%. The 0.798 indicates that for each extra % of single

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Definitions:

Actual Costing

A costing method that assigns actual costs of direct materials, direct labor, and overhead to products, instead of using estimated or standard costs.

Activity-Based Budgeting (ABB)

A method of budgeting where activities that incur costs in every function of an organization are recorded, analyzed and researched.

Conventional Budgeting

A traditional approach to budgeting that involves planning income and expenditures for a fixed period.

Resource Consumption

The process of using resources such as materials, energy, or time, typically quantified for analysis and optimization in various contexts.