The manager of a local shopping mall uses simple linear regression to develop an equation that predicts the number of daily shoplifting incidents at the mall's stores based on the number of security guards employed.The manager uses the following data: The slope of the regression line is b = -1.2; the intercept of the regression line is a = 14.5.
Conduct a hypothesis test to determine whether you can reject the null hypothesis that the population slope, β, is 0 at a 5% significance level.Compute the value of the sample test statistic, tstat.Which of the following is the correct conclusion?
A) Since tstat is outside the critical values of ±3.182, we can reject the β=0 null hypothesis.
B) Since tstat is outside the critical values of ±4.303, we can reject the β=0 null hypothesis.
C) Since tstat is not outside the critical values of ±3.182, we cannot reject the β=0 null hypothesis.
D) Since tstat is not outside the critical values of ±4.303, we cannot reject the β=0 null hypothesis.
Correct Answer:
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