Instruction 16-6
Given Below Are Results from the Regression Analysis

question 1

True/False

Instruction 16-6
Given below are results from the regression analysis on 40 observations where the dependent variable is the number of weeks a worker is unemployed due to a layoff (Y)and the independent variables are the age of the worker (X₁),the number of years of education received (X₂),the number of years at the previous job (X₃),a dummy variable for marital status (X₄: 1 = married,0 = otherwise),a dummy variable for head of household (X₅: 1 = yes,0 = no)and a dummy variable for management position (X₆: 1 = yes,0 = no).
The coefficient of multiple determination (R²_j)the regression model using each of the 6 variables X_j as the dependent variable and all other X variables as independent variables are,respectively,0.2628,0.1240,0.2404,0.3510,0.3342 and 0.0993.
The partial results from best-subset regression are given below:
$$\begin{array} { | l | l | l | l | } \hline \text { Model } & \text { R Square } & \text { Adj. R Square } & \text { Std. Error } \\\hline \text { X1X5Х6 } & 0.4568 & 0.4116 & 18.3534 \\\hline \times 1 \times 2 \times 5 \times 6 & 0.4697 & 0.4091 & 18.3919 \\\hline \times 1 \times 3 \times 5 \times 6 & 0.4691 & 0.4084 & 18.4023 \\\hline \times 1 \times 2 \times 3 \times 5 \times 6 & 0.4877 & 0.4123 & 18.3416 \\\hline \times 1 \times 2 \times 3 \times 4 \times 5 \times 6 & 0.4949 & 0.4030 & 18.4861 \\\hline\end{array}$$
-Referring to Instruction 16-6,the model that includes X₁,X₂,X₃,X₅ and X₆ should be among the appropriate models using the Mallow's C_p statistic.

---

Definitions:

Book Value

The net value of an asset as recorded on a company's balance sheet, calculated as the original cost minus depreciation.

Asset Retirement Obligations

Liabilities recognized for the future costs of disposing of an asset and restoring the site, typically relevant for companies with significant fixed assets.

GAAP

Commonly followed accounting rules and standards for financial reporting, referred to as Generally Accepted Accounting Principles.

Fair Value

The compensation received for an asset's sale or the expenditure for a liability's reassignment in an organized engagement with market participants on the valuation date.