CAS Exam MAS-I Fall 2018, Question 32
Study guide: Exam MAS-I
An actuary uses a multiple regression model to estimate money spent on kitchen equipment using income, education, and savings. He uses 20 observations to perform the analysis and obtains the following output:
| Coefficient | Estimate | Standard Error | t-value |
|---|---|---|---|
| Intercept | 0.15085 | 0.73776 | 0.20447 |
| Income | 0.26528 | 0.10127 | 2.61953 |
| Education | 6.64357 | 2.01212 | 3.30178 |
| Savings | 7.31450 | 2.73977 | 2.66975 |
| Sum of Squares | |
|---|---|
| Regression | 2.65376 |
| Total | 7.62956 |
He wants to test the following hypothesis:
H_0: \beta_1 = \beta_2 = \beta_3 = 0H_1: At least one of\{\beta_1, \beta_2, \beta_3\} \ne 0
Calculate the value of the F-statistics used in this test.
- A) Less than 1
- B) At least 1, but less than 3
- C) At least 3, but less than 5
- D) At least 5
- E) The answer cannot be computed from the information given.
Answer this question and see the worked solution