200052 Introduction to Economic Methods

Use the built regression tool in Excel and your personalized data set (see above) to estimate the simple regression of sales revenue in dollars (Y) generated by a telemarketer in his/her first year of completed service on the number of hours of preliminary training provided to a new telemarketer (X). 
When answering the following questions, assume all the assumptions of the neoclassical (stochastic regressor) simple regression (NSR) model with multivariate normally distributed random disturbances are satisfied.
(b) Clearly state your estimated conditional expectation function (sample regression line).
(c) With reference to your estimated equation, calculate (using a calculator) a 90% confidence interval for the coefficient of X in the model. Give an interpretation of this interval. 
(d) Again with reference to your estimated equation, perform a test of the null hypothesis that the coefficient of number of hours of preliminary training provided to a telemarketer equals zero against the alternative that it is greater than zero, using the (i.e. 5%) level of significance. In presenting your answer to this question you are required to use the 6-step hypothesis testing procedure given in the unit summary lecture notes. 
(e) Give an interpretation of your realized coefficient of determination value.