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An economist estimates the following model: y = β0 + β1x + ε. She would like...

An economist estimates the following model: y = β0 + β1x + ε. She would like to construct interval estimates for y when x equals 2. She estimates a modified model where y is the response variable and the explanatory variable is now defined as x+ = x – 2. A portion of the regression results is shown in the accompanying table.

Regression Statistics
R Square 0.42
Standard Error 3.86
Observations 12
Coefficients Standard Error t-stat p-value Lower 95% Upper 95%
Intercept 24.78 2.76 8.98 4.2E-06 18.63 30.93
Bedroom 2.52 0.95 2.66 0.0237 0.41 4.63


According to the modified model, which of the following is the predicted value of y when x equals 2?

Multiple Choice

  • 2.52

  • 24.78

  • 27.30

  • 29.82

math   Statistics-And-Probability   
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Homework Answers

Answer #1

when x = 2

x-2 = 0

hence

y^ = 24.78 + 2.52* (x-2)

= 24.78

option B) is correct

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