SCENARIO 14-9 You decide to predict gasoline prices in different cities and towns in the United States for your term project.Your dependent variable is price of gasoline per gallon and your explanatory variables are per capita income and the number of firms that manufacture automobile parts in and around the city.You collected data of 32 cities and obtained a regression sum of squares SSR= 122.8821.Your computed value of standard error of the estimate is 1.9549.
-Referring to Scenario 14-9, if the variable that measures the number of firms that manufacture automobile parts in and around the city is removed from the multiple regression model, which of the following would be true?
A)The adjusted will definitely increase.
B)The adjusted cannot increase.
C)The coefficient of multiple determination will not increase.
D)The coefficient of multiple determination will definitely increase.

Question

SCENARIO 14-9 You decide to predict gasoline prices in different cities and towns in the United States for your term project.Your dependent variable is price of gasoline per gallon and your explanatory variables are per capita income and the number of firms that manufacture automobile parts in and around the city.You collected data of 32 cities and obtained a regression sum of squares SSR= 122.8821.Your computed value of standard error of the estimate is 1.9549.
-Referring to Scenario 14-9, if the variable that measures the number of firms that manufacture automobile parts in and around the city is removed from the multiple regression model, which of the following would be true?
A)The adjusted will definitely increase. 
B)The adjusted cannot increase. 
C)The coefficient of multiple determination will not increase. 
D)The coefficient of multiple determination will definitely increase.

Quizplus · Accepted Answer

The coefficient of multiple determination (R-squared) will not increase if an explanatory variable is removed from the multiple regression model.

SCENARIO 14-9 You Decide to Predict Gasoline Prices in Different