Question

A regression model between sales (Y in $1,000), unit price (X1 in dollars) and television advertisement (X2 in dollars) resulted in the following function: = 7 - 3X1 + 5X2 For this model SSR = 3500, SSE = 1500, and the sample size is 18. test for the significance of the model, the test statistic F is a. 2.33 b. 0.70 c. 17.5 d. 1.75

Answer 1

Answer:

C) 17.5

Step-by-step explanation:

Required:

Test for the significance if the model.

Here, we are to find the F statistics.

Take the formula below:

$F = \frac{MSR}{MSE} = \frac{\frac{SSR}{k}}{\frac{SSE}{n - k - 1}}$

Where,

SSR = 3500

SSE = 1500

Sample size, n = 18

k = 2

Substitute figures in the equation:

$F = \frac{\frac{3500}{2}}{\frac{1500}{18 - 2 - 1}}$

$F = \frac{MSR}{MSE} = \frac{1750}{\frac{1500}{15}}$

$F = \frac{MSR}{MSE} = \frac{1750}{100}$

$F = 17.5$

F statistics = 17.5

Option (c) is correct.