Question

Source of Variablty	Degree of Freedom	Sum of Square	Mean Square	F value	P - value
Regression	1	0.27	0.27	18,000	0.0001
Error	22	0.33	0.0150
Total	23	0.6

Variable name	Regression Coefficient	Standard Error	T value	P - value
Constant	7.420	0.32	23.81	0
X1	0.0800	0.05	1.60	0.0600

According to the following table do you think that there exist a relationship between dependent variable (GNP) and independent variables (x1).

3.Write down the hypothesis (10 points)

4.What is your conclusion (10 points)

5.Can you make a hypothesis test for the coefficients? (40 points)

Answer 1

(3) We have to test whether there is any relationship between dependent variable (GNP) and independent variables (x1)

So, it will be a two tailed hypothesis test

(4) based on the p value given in the above table, we can see that the p value is 0.06, which is greater than 0.05 significance level. So, at 0.05 significance level, we can say that there is no significant relationship between the dependent variable GNP and independent variable X1

(5)

test statistic t =

setting b1 = 0.08 and sb1 = 0.05 and beta1 = 0

we get

t statistic = (0.08-0.0)/0.05

= 1.6

and its corresponding p value is given in the table

so, p value = 0.060