A Sample of General Mills Employees Was Studied to Determine

question 19

Multiple Choice

A sample of General Mills employees was studied to determine their degree of satisfaction with
Their present life. A special index, called the index of satisfaction, was used to measure satisfaction.
Six factors were studied: age at the time of first marriage (X1) , annual income (X2) , number of
Children living (X3) , value of all assets (X4) , status of health in the form of an index (X5) , and the
Average number of social activities per week (X6) . Suppose the multiple regression equation is:
Y' = 16.24 + 0.017X1 + 0.00028X2 + 42X3 + 0.0012X4 + 0.09X5 + 26.8X6.
Explain the meaning of b2.

• A) For each additional $1,000 of annual income, their satisfaction index is expected to increase by 0.28 points.
• B) For each additional $1,000 of annual income, their satisfaction index is expected to increase by 2.8 points.
• C) For each additional $1,000 of annual income, their satisfaction index is expected to increase by 28 points.
• D) For each additional living child, their satisfaction index is expected to increase by 42 points.
• E) For each additional living child, their satisfaction index is expected to increase by 4.2 points.

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Definitions:

Common Stock

Equity shares representing ownership in a company, granting voting rights and potential dividends.

Common Stock

A type of equity security that represents ownership in a corporation, entitling holders to vote on corporate matters and receive dividends.

Initial Value Method

An accounting approach where investments are reported at their acquisition cost without subsequent adjustment for changes in market value.