TABLE 14-5
A microeconomist wants to determine how corporate sales are influenced by capital and wage spending by companies. She proceeds to randomly select 26 large corporations and record information in millions of dollars. The Microsoft Excel output below shows results of this multiple regression.
-Referring to Table 14-5, what fraction of the variability in sales is explained by spending on capital and wages?
A) 27.0%
B) 50.9%
C) 68.9%
D) 83.0%

Question

TABLE 14-5
A microeconomist wants to determine how corporate sales are influenced by capital and wage spending by companies. She proceeds to randomly select 26 large corporations and record information in millions of dollars. The Microsoft Excel output below shows results of this multiple regression. 
-Referring to Table 14-5, what fraction of the variability in sales is explained by spending on capital and wages?
A) 27.0% 
B) 50.9% 
C) 68.9% 
D) 83.0%

Quizplus · Accepted Answer

The R-squared value in the Excel output is 0.689, which means that 68.9% of the variability in sales is explained by spending on capital and wages.

TABLE 14-5 A Microeconomist Wants to Determine How Corporate Sales Are Influenced