Econ Project 2 - 1 The coefficient of determination(R2 for...

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1. The coefficient of determination (R 2 ) for the regression of the full model is 0.487494656 . 2. The proportion of variation in the rent explained by its linear regression on the explanatory variables is 0.460425712 when we adjust for the degrees of freedom. 3. In order to explain the explanatory power of the full model the appropriate hypothesis test is the (a) Overall F-test 4. The degrees of freedom associated with the test statistic in part 3 is (are) (d) 15 and 284 . 5. The value of the test statistic in part 3 is 18.00937089 corresponding p-value given by 3.64053E-33 = 3.64053e-33 . 6. At 5% level, based on the results of the test discussed in parts 3. to 5. we can conclude that the model estimated for explaining rent (a) has sufficient explanatory power, . 7. At 5% level, based on the full regression model, the appropriate test for evaluating the positive effect of the average size of bedrooms on rent of an apartment is a (an) (b) Individual t-test . 8. The degrees of freedom associated with the test statistic in part 7 is (b) 284 9. In the full model, the value of the commonly used test statistic and the p-value for testing whether the average size of a bedroom has a any impact on the rent of the apartment are 6.786568529 and 6.68517E-11 = 6.68517e-11 , respectively. 10. . At 5% level, based on the results of the test discussed in parts 7 to 9 we can conclude that the average bedroom size o (a) has no effect on rent o (b) has no positive effect on rent o (c) has no negative effect on rent o (d) has a positive effect on rent o (e) has a negative effect on rent o (f) has some effect on rent 11. Ignoring the result of the test of significance in parts 7 to 10, based on the full model, if the average size of the bedroom goes up by 1 square foot, then all else

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This note was uploaded on 07/23/2010 for the course ECON 203 taught by Professor Petry during the Spring '08 term at University of Illinois at Urbana–Champaign.

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Econ Project 2 - 1 The coefficient of determination(R2 for...

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