Question

For a sample of 8 employees, a personnel director has collected the following data on ownership of company stock vs. years with the firm.
X=years

6, 12, 14, 6, 9, 13, 15, 9
Y= shares
300, 408, 560, 252, 288, 650, 630, 522

For the problem with X=year with firm and y=number of shares own, Perform a t-test testing.

H₀ β_i=0 vs. H_a β₁≠0.

a) what is the standard error of estimate, and what is the value of the standard error of regression slope?

b) how do you compute the test statistic t? The numerator and denominator, and the ratio.

c) Based on the t-test statistic, what is your decision using α=0.25? Why?

d) will you make a different decision if the α=0.01? Explain why?

You must draw the distribution you used and mark the cutoff places for making decision so I know you know which one is the reference distribution.

Answer 1