SCENARIO 14-8 A financial analyst wanted to examine the relationship between salary (in $1,000)and 2 variables: age = Age)and experience in the field = Exper).He took a sample of 20 employees and obtained the following Microsoft Excel output: Also, the sum of squares due to the regression for the model that includes only Age is 5022.0654 while the sum of squares due to the regression for the model that includes only Exper is 125.9848.
-Referring to Scenario 14-8, the F test for the significance of the entire regression performed at a level of significance of 0.01 leads to a rejection of the null hypothesis.

Question

SCENARIO 14-8 A financial analyst wanted to examine the relationship between salary (in $1,000)and 2 variables: age  = Age)and experience in the field  = Exper).He took a sample of 20 employees and obtained the following Microsoft Excel output:   Also, the sum of squares due to the regression for the model that includes only Age is 5022.0654 while the sum of squares due to the regression for the model that includes only Exper is 125.9848.
-Referring to Scenario 14-8, the F test for the significance of the entire regression performed at a level of significance of 0.01 leads to a rejection of the null hypothesis.

Quizplus · Accepted Answer

The p-value for the F test is less than 0.01, therefore the null hypothesis (there is no significant linear relationship between salary and both Age and Exper) is rejected at a level of significance of 0.01. Since the p-value for the F test is less than 0.01, we reject the null hypothesis and conclude that there is a significant relationship between salary, age, and experience in the field.

SCENARIO 14-8 a Financial Analyst Wanted to Examine the Relationship