Thirty Employed Single Individuals Were Randomly Selected to Examine the Relationship

question 3

Essay

Thirty employed single individuals were randomly selected to examine the relationship between their age (Age) and their credit card debt (Debt) expressed as a percentage of their annual income. Three polynomial models were applied and the following table summarizes Excel's regression results. For the cubic model, Debt = β₀+ β₁Age + β₂Age^{2+ β}₃Age³+ ε, the following Excel partial output is available. What is the conclusion when testing the individual significance of Age³?

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Definitions:

Monetary Policy

A central bank's process of managing the money supply and interest rates to influence economic activity.

Economic Policy

Actions taken by a government to influence its economy, including fiscal policy, monetary policy, and trade policy.

Franklin D. Roosevelt

The 32nd President of the United States, serving four terms from 1933 to 1945, and famous for implementing the New Deal to combat the Great Depression.