A researcher analyzes the factors that may influence amusement
park attendance and estimates the following model:
Attendance = ?_{0} +
?_{1}Price +
?_{2}Rides + ?, where
Attendance is the daily attendance (in 1,000s),
Price is the gate price (in $), and Rides is the
number of rides at the amusement park. The researcher would like to
construct interval estimates for Attendance when
Price and Rides equal $85 and 30, respectively.
The researcher estimates a modified model where Attendance
is the response variable and the explanatory variables are now
defined as
Price* = Price – 85 and Rides* =
Rides – 30. A portion of the regression results is shown
in the accompanying table.
Coefficients  Standard Error  tstat  pvalue  Lower 95%  Upper 95%  
Intercept  34.41  4.06  8.48  4.33E09  26.08  42.74 
Price*  ?1.20  0.28  ?4.23  0.0002  ?1.79  ?0.62 
Rides*  3.62  0.36  10.15  1.04E10  2.89  4.35 
According to the modified model, which of the following is the predicted value for Attendance when Price and Rides equal $85 and 30, respectively?
55,600 

25,670 

34,410 

40,910 
Question 27 Tiffany & Co. has been the world's premier jeweler since 1837. The performance of Tiffany's stock is likely to be strongly influenced by the economy. Monthly data for Tiffany's riskadjusted return and the riskadjusted market return are collected for a fiveyear period (n = 60). The accompanying table shows the regression results when estimating the CAPM model for Tiffany's return.
When testing whether the beta coefficient is significantly greater than one, the relevant critical value at the 5% significance level is t_{0.05,58} = 1.672. The conclusion to the test is to ________.

40,910 
THe true regression modle is
Attendance =B_{0}+B_{1}Price + B_{2}Rides + e
when researcher estimates a modified model where Attendance is
the response variable and the explanatory variables are now defined
as
Price* = Price – 85 and Rides* = Rides – 30.
Then, estimated regression model is
Attendance =34.41 1.20 Price^{*} +3.62 Rides^{*}
the predicted value for Attendance when Price and Rides equal $85 and 30 is
Attendance =34.41 1.20 (Price85) +3.62 (Rides30)
Attendance =34.41 1.20 (8585) +3.62 (3030)
Attendance =34.41 (in 1,000s)
Attendance =34,410
27.
The conclusion to the test is to reject H_{0}, and conclude that the return on Tiffany stock is riskier than the return on the market
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