Homework Sourse4 Use the data and model YtBo B1Xt Et to answer the followin
4. Use the data and model (Yt-Bo B1Xt +Et) to answer the following questions: Sales Revenue, Advertising Expenditure, 3 4 5 4 (a) [7 points] Calculate bo, b,, and their estimated standard errors. (b) [4 points] Calculate R2 and explain what it measures. (c) [4 points Are the coefficients individually statistically significant (a0.10)? ![4. Use the data and model (Yt-Bo B1Xt +Et) to answer the following questions: Sales Revenue, Advertising Expenditure, 3 4 5 4 (a) [7 points] Calculate bo, b,,](/WebImages/43/4-use-the-data-and-model-ytbo-b1xt-et-to-answer-the-followin-1133146-1761605846-0.webp "4. Use the data and model (Yt-Bo B1Xt +Et) to answer the following questions: Sales Revenue, Advertising Expenditure, 3 4 5 4 (a) [7 points] Calculate bo, b,,")
Solution
a. The slope coefficient is 0.7 and the intercept term is -0.1.b0=-0.1 and b1=0.7.
b. The R squared is 81.67%. This means that 81.67% of the variation in revenue is explained by advertising expenditure.
c. The slope coefficient is significant at the 5% level. The intercept term is not significant.
