A researcher analyzes the factors that may influence amusement park attendance. She estimates the following model: Attendance = β₀ + β₁Price + β₂Temperature + β₃Rides + ε, where Attendance is the daily attendance (in 1,000s), Price is the gate price (in $), Temperature is the average daily temperature (in °F), and Rides is the number of rides at the amusement park. A portion of the regression results is shown in the accompanying table. Which of the following are the hypotheses to test if the explanatory variables Temperature and Rides are jointly significant in explaining Attendance? A) H₀: β₂ = β₃ = 0; H_A: At least one of the coefficients is nonzero. B) H₀: β₂ = β₃ = 0; H_A: At least one of the coefficients is zero. C) H₀: β₀ = β₁ = 0; H_A: At least one of the coefficients is nonzero. D) H₀: β₀ = β₁ = 0; H_A: At least one of the coefficients is zero.

Question

Quizplus · Accepted Answer

The joint significance test for Temperature and Rides can be conducted by testing if both coefficients are jointly different from zero. This can be represented by the null hypothesis H₂: β₂ = β₃ = 0 and the alternative hypothesis H_A: At least one of the coefficients is nonzero. Therefore, option A is the correct hypothesis to test joint significance.

A Researcher Analyzes the Factors That May Influence Amusement Park