A Regression Was Performed on a Sample of 16 Observations $\beta$

question 97

Essay

A regression was performed on a sample of 16 observations. The estimated equation is = 23.5 - 14.28x₁ + 6.72x₂ + 15.68x₃. The standard errors for the coefficients are S_b1 = 4.2, S_b2 = 5.6, and S_b3 = 2.8. For this model, SST = 3809.6 and SSR = 3285.4.
a.Compute the appropriate t ratios.
b.Test for the significance of $\beta$ ₁, $\beta$ ₂, and $\beta$ ₃ at the 5% level of significance.
c.Do you think that any of the variables should be dropped from the model? Explain.
d.Compute R² and R_a². Interpret R².
e.Test the significance of the relationship among the variables at the 5% level of significance.

Understand how to apply demand and supply functions to determine market equilibria.

Analyze the effects of taxes on market equilibrium, including the impact on quantities supplied and demanded.

Assess the impact of taxes on the equilibrium price paid by consumers and received by producers.

Understand the concept of elasticity and how it affects market outcomes.

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