# The coefficient of a linear regression equation

1.The coefficient of a linear regression equation indicates

the change in the independent variable relative to a unit change in the dependent variable.

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the change in the dependent variable relative to a unit change in the independent variable.

the percentage change in the dependent variable relative to a unit change in the independent variable.

the percentage change in the independent variable relative to a unit change in the dependent variable

2.Which of the following is most likely to indicate a statistically significant regression coefficient?

t > 2

R2 > .90

t > R2

F > 4

none of the above because of insufficient information

3.Answer the following question on the basis of the regression results below (standard errors in parentheses, n = 200)
Qd = -500 – 100Pa + 50Pb + .3I + .2A

(250) (50) (30) (.1) (.8)

R2 = .12

where:

Qd = 10,500, quantity demanded of product “A”

Pa = \$10, price of product “A”

Pb = \$8, price of product “B”

I = \$12,000, per capita income

A = \$20,000, monthly advertising expenditures

Which of the variables does not pass the t-test at the .05 level of significance?

Pa

Pb

I

A

Both A and Pb

Solution Preview
1.The coefficient of a linear regression equation indicates

the change in the independent variable relative to a unit change in the dependent variable.
the change in the dependent variable relative to a unit change in the independent variable.
the percentage change in the dependent variable relative to a unit change in the independent variable.
the percentage change in the independent variable relative to a unit …

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