THE NEXT QUESTIONS ARE BASED ON THE FOLLOWING INFORMATION

question 173

Multiple Choice

THE NEXT QUESTIONS ARE BASED ON THE FOLLOWING INFORMATION:
A researcher is interested in determining the monthly household expenditures on groceries.He models the relationship as follows: Y = β₀ + β₁X₁ + β₂X₂ + β₃X₃ + ε,where Y is the monthly dollar value spent on groceries,X₁ is the household's monthly income,X₂ is the number of people living in the household,and X₃ is a dummy variable = 1 if both the adults in the household work.Taking a sample of 250 households,the researcher gets the following results:
= 172.1 + 0.048x₁ + 33.1x₂ + 43.2x₃.
-How should the researcher interpret the coefficient of the dummy variable?

• A)Households with both adults working approximately spend $43.20 on groceries,under the assumption that all the other independent variables in the model are held constant.
• B)Households with both adults working spend,on average,$43.20 less than other households,under the assumption that all the other independent variables in the model are held constant.
• C)Households with both adults working spend,on average,$43.20 more than other households,under the assumption that all the other independent variables in the model are held constant.
• D)There is no difference between the types of households and their spending on groceries,under the assumption that all the other independent variables in the model are held constant.

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Definitions:

Nonverbal Communication

Interaction that occurs without words, utilizing methods such as physical gestures and facial expressions to express feelings and convey messages.

Attitudes

Attitudes are settled ways of thinking or feeling about something, typically reflected in a person's behavior.

Emotions

Complex psychological states involving subjective feelings, physiological arousal, and expressive behaviors.

Unconsciously

Performing actions or having thoughts and feelings without being aware of them.