A researcher interested in explaining the level of foreign reserves for the country of Barbadosestimated the following multiple regression model using yearly data spanning the period 2001 to2016:FR=a+B0IL+YEXP+8FDIWhere FR = yearly foreign reserves ($000°s), OIL = annual oil prices, EXP = yearly total exports($000's) and FDI = annual foreign direct investment ($000`s). The sample of data was processedusing MINITAB and the following is an extract of the output obtained:PredictorCoefStDevt-ratiop-valueConstant5491.382508.812.18880.0491OIL85.3918.464.6260.0006EXP-377.08112.190.0057FDI-396.99160.66-2.471**s = 2.45R-sq = 96.3%R-sq (adj)= 95.3%Analysis of VarianceSourceDFMSFRegression1991.31663.77??Error1277.46.45Total15d) Hence test whether ß is significant. Give reasons for your answer.e) Perform the F Test making sure to state the null and alternative hypothesis.f) Given an interpretation of the term “R-sq“ and comment on its value.

The null and alternative hypotheses are The test statistic is given by t = 4626 p-value = 0.006…

estimated the following multiple regression model using yearly data spanning the period 2001 2016: FR=a+B0IL+YEXP+8FDI Where FR = yearly foreign reserves ($000`s), OIL = annual oil prices, EXP = yearly total expo $00's) and FDI = annual foreign direct investment ($000°s). The sample of data was process ising MINITAB and the following is an extract of the output obtained:

estimated the following multiple regression model using yearly data spanning the period 2001 2016: FR=a+B0IL+YEXP+8FDI Where FR = yearly foreign reserves ($000`s), OIL = annual oil prices, EXP = yearly total expo $00's) and FDI = annual foreign direct investment ($000°s). The sample of data was process ising MINITAB and the following is an extract of the output obtained:

MATLAB: An Introduction with Applications

6th Edition

ISBN:9781119256830

Author:Amos Gilat

Publisher:Amos Gilat

Chapter1: Starting With Matlab

Section: Chapter Questions

Problem 1P

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Concept explainers

Correlation

Correlation defines a relationship between two independent variables. It tells the degree to which variables move in relation to each other. When two sets of data are related to each other, there is a correlation between them.

Linear Correlation

A correlation is used to determine the relationships between numerical and categorical variables. In other words, it is an indicator of how things are connected to one another. The correlation analysis is the study of how variables are related.

Regression Analysis

Regression analysis is a statistical method in which it estimates the relationship between a dependent variable and one or more independent variable. In simple terms dependent variable is called as outcome variable and independent variable is called as predictors. Regression analysis is one of the methods to find the trends in data. The independent variable used in Regression analysis is named Predictor variable. It offers data of an associated dependent variable regarding a particular outcome.

Question

A researcher interested in explaining the level of foreign reserves for the country of Barbados
estimated the following multiple regression model using yearly data spanning the period 2001 to
2016:
FR=a+B0IL+YEXP+8FDI
Where FR = yearly foreign reserves ($000°s), OIL = annual oil prices, EXP = yearly total exports
($000's) and FDI = annual foreign direct investment ($000`s). The sample of data was processed
using MINITAB and the following is an extract of the output obtained:
Predictor
Coef
StDev
t-ratio
p-value
Constant
5491.38
2508.81
2.1888
0.0491
OIL
85.39
18.46
4.626
0.0006
EXP
-377.08
112.19
0.0057
FDI
-396.99
160.66
-2.471
**
s = 2.45
R-sq = 96.3%
R-sq (adj)
= 95.3%
Analysis of Variance
Source
DF
MS
F
Regression
1991.31
663.77
??
Error
12
77.4
6.45
Total
15
d) Hence test whether ß is significant. Give reasons for your answer.
e) Perform the F Test making sure to state the null and alternative hypothesis.
f) Given an interpretation of the term “R-sq“ and comment on its value.

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