D Question2 3 pts Suppose you are working with the automobile data set and got t

Question

D Question2 3 pts Suppose you are working with the automobile data set and got the following printout. Assume that you already tested the quadratic terms and dropped them out of the model. The following printout was created Least Squares Linear Regression of Price Predictor Variables Coefficient Std Error T Constant 20339.7 1039.20 19.57 0.0000 0.0 P VIF Mileage -0.06642 0.02264 -2.930.0052 1.8 Model X1X2 1255.69 1454.48 0.86 0.3924 7.0 0.04875 0.03590-1.36 0.2244 6.6 What p-value should you use to determine if the interaction term is useful for predicting price? You can assume that a two-tailed test was conducted. 4488 0052 1122 2244 5 8

Explanation / Answer

We want to specify the P-value used for testing of the interaction effect.

In testing, we are using two-tailed test because our hypothesis is  

Ho:-Interaction effect is 0 i.e. B12=0 Vs

H1:- Interaction effect is not equal to 0 i.e. B12 = 0

So P-value for interaction effect given in the table is

For Variable X1X2 The P-value is 0.2244

Answer : 0.2244

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