The Following Data Are Available for a Simple Linear Regression

question 7

Multiple Choice

The following data are available for a simple linear regression analysis attempting to link hours of training (x) to hourly output (y) . The slope term in the estimated regression equation was 2.4.The intercept term (a) was 3.6.Show the 90% prediction interval for hourly output for an individual with 2.5 hours of training.Report the upper bound for the interval.

• A)11.6
• B)20.4
• C)12.1
• D)22.4
• E)26.5

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Definitions:

Productive Efficiency

A situation where an economy or entity is operating in such a way that it cannot produce more of one good without decreasing the production of another good.

Economic Profits

The difference between total revenue and total costs, including both explicit and implicit costs, representing surplus value created by a firm.

Excess Capacity

A situation where a firm or industry has more production resources available than is necessary to produce the current level of output, often indicating inefficiency.

Minimum ATC

Minimum ATC, or minimum average total cost, is the lowest point on the average total cost curve, representing the most efficient scale of production for a firm.