Question 1
An academic advisor wants to predict the typical starting salary of a graduate at a top business school using the GMAT score of the school as a predictor variable. A simple linear regression of SALARY versus GMAT using 25 data points is shown below.
0 = -92040
1 = 228
s = 3213 df = 23
t = 6.67
Set up the null and alternative hypotheses for testing whether a linear relationship exists between SALARY and GMAT.
◦
H0:
β1 = 0 vs.
Ha:
β1 ≠ 0
◦
H0:
β1 = 0 vs.
Ha:
β1 > 0
◦
H0:
β1 > 0 vs. H
a: β
1 < 0
◦
H0:
1 = 228 vs.
Ha:
1 > 228
Question 2
Consider the following model
y =
β0 +
β1x +
∈, where y is the daily rate of return of a stock, and
x is the daily rate of return of the stock market as a whole, measured by the daily rate of return of Standard & Poor's (S&P) 500 Composite Index. Using a random sample of
n = 12 days from 2007, the least squares lines shown in the table below were obtained for four firms. The estimated standard error of
1 is shown to the right of each least squares prediction equation.
| Firm | Estimated Market Model | Estimated Standard Error of β1 |
| Company A | y = .0010 + 1.40x | | .03 | |
| Company B | y = .0005 - 1.21x | | .06 |
| Company C | y = .0010 + 1.62x | 1 | .34 |
| Company D | y = .0013 + .76x | | .15 |
Calculate the test statistic for determining whether the market model is useful for predicting daily rate of return of Company A's stock.
◦ 46.7
◦ 1.40
◦ 161.6
◦ 1.40 ± .067
Noll's DNase-I digestion experiment, which verified the beads-on-a-string model of DNA compacti
Model for cytoplasmic segregation
Daily pill containers like this one are often used by the elderly to remind them
Relationship between Income Inequality and the Desired Tax Rate
Stock Market Tracks Growth in GDP
Daniel's Enterprises has a beta of 1.98 and a growth rate of 12 percent. The stock is ...