MGT3002 Week 3 Discussion

Week 4: Chapter 14 and 15 Homework

1. In a regression analysis, if r2 = 1, then _____.

a. SSE can be any positive value

b. SSE must be equal to 0

c. SSE must also be equal to 1

d. SSE must be negative

2. You are given the following information about x and y.

X Independent Variable y

Dependent Variable

1 5

2 4

3 3

4 2

5 1

The coefficient of determination equals _____.

a. –1

b. –.5

c. 0

d. 1

3. The following estimated regression model was developed relating yearly income (y in $1000s) of 30 individuals with their age (x1) and their gender (x2) (0 if male and 1 if female).

ŷ = 30 + 0.7x1 + 3x2

Also provided are SST = 1200 and SSE = 384.

The yearly income of a 24-year-old male individual is _____.

a. $46,800

b. $13.80

c. $49,800

d. $13,800

4. Below you are given a partial Excel output based on a sample of 16 observations.

ANOVA

df SS MS F

Regression 4,853 2,426.5

Residual 485.3

Coefficients Standard Error

Intercept 12.924 4.425

x1 -3.682 2.630

x2 45.216 12.560

Carry out the test of significance for the parameter β1 at the 1% level. The null hypothesis should _____.

a. be rejected

b. be revised

c. not be rejected

d. None of these answers are correct.

5. A measure of the strength of the relationship between two variables is the _____.

a. confidence interval estimate

b. correlation coefficient

c. standard error of the estimate

d. slope b1 of the estimated regression line

6. a. y = β0 + β1x1 + β2x2 + ε

b. E(y) = β0 + β1x1

c. ŷ = b0 + b1 x1 + b2 x2

d. E(y) = β0 + β1x1 + β2x2

Which equation describes the multiple regression model?

a. equation c

b. equation a

c. equation b

d. equation d

7. A regression model involving 4 independent variables and a sample of 15 periods resulted in the following sum of squares:

SSR = 165

SSE = 60

If we want to test for the significance of the model at 95% confidence, the critical F value (from the table) is ______.

a. 3.48

b. 3.06

c. 3.34

d. 3.11

8. In regression analysis, the independent variable is typically plotted on the _____.

a. y-axis of a histogram

b. x-axis of a scatter diagram

c. x-axis of a histogram

d. y-axis of a scatter diagram

9. You are given the following information about x and y.

x	y
Independent	Dependent
Variable	Variable
15	5
12	7
10	9
7	11

The coefficient of determination equals _____.

a. –.99705

b. .9941

c. –.9941

d. .99705

10. A data point (observation) that does not fit the trend shown by the remaining data is called a(n) _____.

a. outlier

b. residual

c. point estimate

d. None of these answers are correct.