If you wanted to test, using a 5% significance level, whether or not a specific slope coefficient is equal to one, then you should:A. add and subtract 1.96 from the slope and check if that interval includes 1. B. subtract 1 from the estimated coefficient, divide the difference by the standard error, and check if the resulting ratio is larger than 1.96. C. see if the slope coefficient is between 0.95 and 1.05. D. check if the adjusted R squared is close to 1.

Question

Karley Fields

Mathematics

29 August, 19:35

If you wanted to test, using a 5% significance level, whether or not a specific slope coefficient is equal to one, then you should:A. add and subtract 1.96 from the slope and check if that interval includes 1. B. subtract 1 from the estimated coefficient, divide the difference by the standard error, and check if the resulting ratio is larger than 1.96. C. see if the slope coefficient is between 0.95 and 1.05. D. check if the adjusted R squared is close to 1.

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Answers (1)

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Tania Sweeney · Answer 1

B. subtract 1 from the estimated coefficient, divide the difference by the standard error, and check if the resulting ratio is larger than 1.96.

Step-by-step explanation:

Given that you wanted to test, using a 5% significance level, whether or not a specific slope coefficient is equal to one, then you should:

For 95% confi level Z critical = 1.96

So we multiply the std error by 1.96 to get margin of error

Using confidence intervals we divided the slope difference by std error and check whether this absolute value is greater than 1.96

Hence option B is right

B. subtract 1 from the estimated coefficient, divide the difference by the standard error, and check if the resulting ratio is larger than 1.96.