A Sample of Firms Was Selected from the High Tech

question 21

Essay

A sample of firms was selected from the high tech industry (Industry = 1) and the financial services sector (Industry = 0). Data were collected on the following variables: turnover rate, job growth, number of employees, and innovative index (higher scores indicate a more innovative and creative organizational culture). Below are the multiple regression results. a. Write out the estimated regression equation.
b. Are all of the independent variables significant in this regression equation (using α = 0.05)? Explain.
c. Interpret the coefficient of the Industry.
d. An alternative multiple regression model is fit to these data and the results are shown below. Which model is better? Explain. e. Based on the scatterplot below, is it appropriate to use Industry as an indicator variable in this regression model? Explain. f. Using the better model, predict turnover rate for a firm in the financial services sector with 1000 employees, an innovative index of 50 and 2% job growth rate.

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Definitions:

Keynesians

Economists or the economic theory advocating for government intervention in the economy, especially fiscal policy, to manage demand and address unemployment.

Say's Law

A principle that asserts supply creates its own demand, suggesting that producing goods and services generates the means and willingness to purchase other goods and services.

Economy Produces

Refers to the total output of goods and services generated by an economy within a specific period.

Real Balance Effect

The influence a change in household purchasing power has on the quantity of real GDP that consumers are willing to buy.