A random sample of 79 companies from the Forbes 500 list was selected and the re

Question

A random sample of 79 companies from the Forbes 500 list was selected and the relationship between sales (in hundreds of thousands of dollars) and profits (in hundreds of thousands of dollars) was investigated by regression. The following results were obtained from statistical R2-0.662 s 466.2 Variable Constant or ntercept Sales Standard error 61.1i Parameter estimate -176.644 0.0075 What is an (approximate) 90% confidence interval for the slope ?? ? A.-0.09 0.0075 0 B. 0.09 ± 0.01 25 C0.09+0.0075 ? D.-0.09 0.0125

Explanation / Answer

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So, the Confidence interval is given by :

Mean +/- Z*SE

The coefficent or B1 is the Mean, and the SE is .0075.

The Z for 90% CI is 1.645. So, applying all this in the above mentioned formulae:

= +.092498 +/- 1.645*0.0075

= .092498 +/- .0125

So, the nearest answer is B. .09 +/- .0125

Answer is B

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