What is the regression test of B (beta)? and what are the steps in completing this...

What is the regression test of B (beta)? and what are the steps in completing this test?

Expert Solution

regression test of beta it to test whether beta is significant or not

..............

steps::

slope hypothesis test               tail=   2
Ho:   ß1=   0
H1:   ß1╪   0
n=   8
alpha =   0.05

estimated std error of slope =Se(ß1) = Se/√Sxx

t stat = estimated slope/std error =ß1 /Se(ß1)

t-critical value   [excel function: =T.INV.2T(α,df) ]

Degree of freedom ,df = n-2

compare test stat with critical value

if test stat > critical, reject Ho

regression is significant

if test stat < critical , do not reject Ho

regresssion is insignificant

................

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orchestra answered 2 years ago

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