This regression is based on cross-section data of 1744 individuals and the relationship between their weekly earnings (in dollars) and age (in years) during 2020. The regression yielded the following result:Estimated(EARN) = 239.16 + 5.20(Age) , R = 0.05, SER = 287.21Standard errors are reported as hereunder:SE(intercept) = (20.24)SE(Age) = (0.57)(a) Is the relationship between "Age" and "EARN" statistically significant?(b) Explain the meaning of heterskedasticity. Is there any reason to be concerned about heteroskedasticity in this model? Briefly explain your reasons.(c) Construct a 95% confidence interval for the slope coefficient, and use it to test for the statistical significance of the slope coefficient.(d) Construct a 95% confidence interval for the intercept coefficient, and use it to test for the statistical significance of the intercept coefficient.

(a) The slope coefficient of 5.20 indicates that if the age of a specific individual increases by 1…

This regression is based on cross-section data of 1744 individuals and the relationship between their weekly earnings (in dollars) and age (in years) during 2020. The regression yielded the following result: Estimated(EARN) = 239.16 + 5.20(Age) , R² = 0.05, SER = 287.21 Standard errors are reported as hereunder: SE(intercept) = (20.24) SE(Age) = (0.57) (a) Is the relationship between "Age" and "EARN" statistically significant? (b) Explain the meaning of heterskedasticity. Is here any reason to be concerned about heteroskedasticity in this model? Briefly explain your reasons. (c) Construct a 95% confidence interval for the slope coefficient, and use it to test for the statistical significance of the slope coefficient. (d) Construct a 95% confidence interval for the intercept coefficient, and use it to test for the statistical significance of the intercept coefficient.

This regression is based on cross-section data of 1744 individuals and the relationship between their weekly earnings (in dollars) and age (in years) during 2020. The regression yielded the following result: Estimated(EARN) = 239.16 + 5.20(Age) , R² = 0.05, SER = 287.21 Standard errors are reported as hereunder: SE(intercept) = (20.24) SE(Age) = (0.57) (a) Is the relationship between "Age" and "EARN" statistically significant? (b) Explain the meaning of heterskedasticity. Is here any reason to be concerned about heteroskedasticity in this model? Briefly explain your reasons. (c) Construct a 95% confidence interval for the slope coefficient, and use it to test for the statistical significance of the slope coefficient. (d) Construct a 95% confidence interval for the intercept coefficient, and use it to test for the statistical significance of the intercept coefficient.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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