Figure:
Suppose You Regress U $\text { Figure } 5.1$

question 32

Multiple Choice

Figure:
Suppose you regress U.S.annual real GDP ($ billions) on U.S.annual real defense expenditures ($ millions) and that you get the following results. SUMMARY OUTPUT

$\begin{array}{lc}\hline \text { Regvessiait Statistics } & \\\hline \text { Muatiple R. } & 0.523337059 \\\text { R Sqare } & 0.273881677 \\\text { Adjusted R Square } & 0.263508558 \\\text { Standard Error } & 3201.551247 \\\text { Obsenvations } & 72 \\\hline\end{array}$


$\begin{array}{l}\text { ANOVA }\\\begin{array}{lccccc}\hline & \text { of } & S S & \text { MS } & F & \text { Siguffecance } F \\\hline \text { Regressice } & 1 & 270629128.2 & 270629128.2 & 26.4030211 & 2.39636 \mathrm{E}-06 \\\text { Residual } & 70 & 717495127 & 10249930.39 & & \\\text { Total } & 71 & 988124255.3 & & & \\\hline\end{array}\end{array}$

$\begin{array}{lcccccc}\hline & \text { Coeffieients } & \text { Staudard Errar } & t \text { Stat } & \text { P-value } & \text { Lower } 95 \% & \text { Upper } 95 \% 6 \\\hline \text { linercept } & 1273.293919 & 979.7967762 & 1.299548998 & 0.198019186 & -680.8491085 & 3227.436946 \\\text { Real Defense Expesdtures (milions) } & 0.013659042 & 0.002658235 & 5.138387013 & 2.39636 \mathrm{E}-06 & 0.008357359 & 0.018960725 \\\hline\end{array}$

$\text { Figure } 5.1$



-Based on the Excel output in Figure 5.1,you should conclude that a

• A)$1 million increase in real defense expenditures is estimated to be associated with a statistically significant $1,273.29 billion increase in real GDP,holding all else constant.
• B)real GDP is estimated to be a statistically significant $1,273.29 billion when real defense expenditures are 0,holding all else constant.
• C)$1 million increase in real defense expenditures is estimated to be associated with a statistically insignificant $13.659 million increase in real GDP,holding all else constant.
• D)a $1 million increase in real defense expenditures is estimated to be associated with a statistically significant $13.659 million increase in real GDP,holding all else constant.

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