A Sociologist Estimates the Regression Relating Poverty (Y)to Education (X₁)

question 25

Essay

A sociologist estimates the regression relating Poverty (y)to Education (x₁).The estimated regression equation is: = 71.68 - 0.69x₁;n = 39;SSE = 152.
In an attempt to improve the results,he adds two more explanatory variables: Median Income (x₂,in $1,000s)and the Mortality Rate (x₃,per 1,000 residents).The estimated regression equation is: = 59.80 - 0.44x₁- 0.18x₂ + 0.17x₃;n = 39;SSE = 60.
.a.Formulate the hypotheses to determine whether Median Income and the Mortality Rate are jointly significant in explaining Poverty.
b.Calculate the value of the test statistic.
c.At the 5% significance level,find the approximate value of the critical value(s).
d.What is the conclusion to the test?

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Definitions:

Budgeted Costs

Estimated expenses planned for a set period of time, forming the basis of a budget for managing a business's or project's financial resources.

Materials Price Standard

Pre-determined cost at which materials should be bought, used for budgeting and assessing purchasing performance.

Purchasing Department

A specialized division within a company responsible for acquiring goods and services that the company needs to operate.

Overhead Variance

The difference between the actual overhead costs incurred and the overhead costs applied to products or services.