If you wanted to test, using a 5% significance level, whether or not a specific slope coefficient is equal to one, then you should:

A. see if the slope coefficient is between 0.95 and 1.05.

B. check if the adjusted R2 is close to 1.

C. subtract 1 from the estimated coefficient, divide the difference by the standard error, and check if the resulting ratio is larger than 1.96.

D. add and subtract 1.96 from the slope and check if that interval includes 1.

Question

Mathematics

Jakayla Mathews

8 November, 05:11

If you wanted to test, using a 5% significance level, whether or not a specific slope coefficient is equal to one, then you should:

A. see if the slope coefficient is between 0.95 and 1.05.

B. check if the adjusted R2 is close to 1.

C. subtract 1 from the estimated coefficient, divide the difference by the standard error, and check if the resulting ratio is larger than 1.96.

D. add and subtract 1.96 from the slope and check if that interval includes 1.

+3

Answers (1)

Know the Answer?

Vanessa Rosario · Answer 1

If you wanted to test, using a 5% significance level, whether or not a specific slope coefficient is equal to one, then you should subtract 1 from the estimated coefficient, divide the difference by the standard error, and check if the resulting ratio is larger than 1.96.

Option B is the correct answer.

Step-by-step explanation:

If you wanted to test, using a 5% significance level, whether or not a specific slope coefficient is equal to one, then you should subtract 1 from the estimated coefficient, divide the difference by the standard error, and check if the resulting ratio is larger than 1.96.

Option B is correct because after subtracting it from 1, it will become a standardized test if the slope is equal to 0 or not.