Question

A researcher analyzes the factors that may influence amusement park attendance. She estimates the following model: Attendance = ?₀ + ?₁Price + ?₂Temperature + ?₃Rides + ?, where Attendance is the daily attendance (in 1,000s), Price is the gate price (in $), Temperature is the average daily temperature (in °F), and Rides is the number of rides at the amusement park. A portion of the regression results is shown in the accompanying table.

	df	SS	MS	F	Significance F
Regression	3	29,524.41	9,841.47		2.18E-14
Residual	26	2,564.37	98.63
Total	29	32,088.78
	Coefficients	Standard Error	t-stat	p-value	Lower 95%	Upper 95%
Intercept	27.328	40.254		0.5032	?55.415	110.071
Price	?1.201	0.294		0.0004	?1.805	?0.598
Temperature	0.008	0.208		0.9693	?0.419	0.435
Rides	3.621	0.364		2.32E-10	2.874	4.369

When testing whether the explanatory variables Temperature and Rides are jointly significant, the error sum of squares for the restricted model is SSE_R = 12,343.78. Which of the following is the value of the test statistic when conducting this test?

49.58

?4.09

25.33

Question 9

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 risk-adjusted return and the risk-adjusted market return are collected for a five-year period (n = 60). The accompanying table shows the regression results when estimating the CAPM model for Tiffany's return.

	Coefficients	Standard Error	t-stat	p-value	Lower 95%	Upper 95%
Intercept	0.0198	0.010	1.98	0.0598	?0.0008	0.0405
RM – Rf	1.827	0.191	9.58	1.494E-13	1.4456	2.2094

When testing whether the beta coefficient is significantly greater than one, the value of the test statistic is ________.

9.58

4.33

1.98

Question 10

A sociologist wishes to study the relationship between happiness and age. He interviews 24 individuals and collects data on age and happiness, measured on a scale from 0 to 100. He estimates the following model: Happiness = ?₀ + ?₁Age + ?. The following table summarizes a portion of the regression results.

	Coefficients	Standard Error	t-stat	p-value
Intercept	56.1772	5.2145	10.7732	0.0000
Age	0.2845	0.0871	3.2671	0.0035

At the 1% significance level, which of the following is correct?

		Do not reject the null hypothesis. At 1% significance level, we conclude that Age is not significant in explaining Happiness.
		Reject the null hypothesis. At 1% significance level, we conclude that Age is significant in explaining Happiness.
		Reject the null hypothesis. At 1% significance level, we conclude that Age is not significant in explaining Happiness.
		Do not reject the null hypothesis. At 1% significance level, we conclude that Age is significant in explaining Happiness.

?1.98

99.78 chose this one just double checking

Answer 1

Q 8) F score= MSRegression/ MSResidual

Q9) Hypothesis test :

and

The test statistic:

Q 10) Coefficient of AGE: t= 3.2671 and P-value= 0.0035

P-value is less than 0.01. The test statistic is significant and rejects H0.

Reject the null hypothesis. At 1% significance level, we conclude that Age is significant in explaining Happiness.