Exhibit 15-8

question 115

Multiple Choice

Exhibit 15-8.A real estate analyst believes that the three main factors that influence an apartment's rent in a college town are the number of bedrooms,the number of bathrooms,and the apartment's square footage.For 40 apartments,she collects data on the rent (y,in $) ,the number of bedrooms (x₁) ,the number of bathrooms (x₂) ,and its square footage (x₃) .She estimates the following model: .The following table shows a portion of the regression results. Refer to Exhibit 15-8.Which of the following are the hypotheses to test if the explanatory variables Bath and Sqft are jointly significant in explaining Rent?

• A) : Both of the coefficients are nonzero
• B) : At least one of the coefficients is zero
• C) : At least one of the coefficients is nonzero

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Definitions:

Capitalized

The recording of an expense or cost as an asset on a balance sheet, rather than an immediate expense.

Installation Costs

Expenses associated with setting up or installing equipment, machinery, or infrastructure necessary for the operation of a business or service.

Maintenance Costs

Expenses incurred in the upkeep of assets, ensuring they continue to operate effectively without significant degradation or failure.

Capital Expenditure

Funds used by a company to acquire or upgrade physical assets such as property, industrial buildings, or equipment to improve its long-term service potential.