Question

In: Finance

In the following Stata output, calculate the value of the t statistic for the coefficient of X3.

In the following Stata output, calculate the value of the t statistic for the coefficient of X3.

Solutions

Expert Solution

In regression, the t statistic is calculated by the coefficient divided by its standard error.

 

The coefficient of X3 is given by 349.4953 and the standard error of this coefficient is equal to 71.82588.

 

Therefore, the value of the t-statistic for the variable X3 is equal to,

 

349.4953/71.82588 = 4.86.


Therefore, the value of the t-statistic for the variable X3 is equal to,

 

349.4953/71.82588 = 4.86.

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