Question

How do we check if the independent variables are statistically significant and contribute to the multiple regression models?

Answer 1

let us consider multiple linear model

Y =B0 +B1X1 +B2X2 +.......+BnXn

Now we are interested in to check the independent variable (X1,X2...Xn) are statistically significant or not

So we test the hypothesis as

Ho : B i =0 ;i =1,2,.....,n

i.e. i^th independent variable is statistically insignificant

Vs

H1 : Bi 0 ; i= 1,2,....,n

i.e. i^th independent variable is statistically significant and contribute in multiple linear equation.

Test statistics = ~ t _n-1

_{Decision Rule : If P-value is < 0.05 then we reject Ho, so we may say that ith independent variable is statistically significant .}

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_{above procedure do for all independent variable then we get all significant independent variables which contribute in multiple regression model.}