I NEED ANSWERS TO PARTS E TO I. Question 3 (2.8 marks) The Australian Government
ID: 3201111 • Letter: I
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I NEED ANSWERS TO PARTS E TO I.
Question 3 (2.8 marks) The Australian Government's Energy Efficiency Opportunities program encourages large energy using businesses to improve their energy efficiency. It does this by requiring businesses to identify, evaluate and report publicly on cost effective energy savings opportunities. As part of the process of identifying factors impacting on electricity consumption, a large super market chain took a sample of 30 stores and investigated the relationship between electricity consumption and store size. Consider the simple regression model: consi 60 61 sizeitEi Where: cons is annual electricity consumption measured in megawatt hours for store i; size, is the size of store i measured in square meter Ei is the disturbance term; and 60 and 61 are unknown parameters. The regression model was estimated by ordinary least squares and an extract of the resultant EXCEL output is reproduced below:Explanation / Answer
e ) p value in simple terms means the evidence that the data suggests in favor of the null hypothesis.
p values are usuallu used in conjunction with hypothesis test
here in this case of intercept , it means
H0 : The intercept is not significant
H1 : The intercept is significant
so at an alpha =0.05 , we can say that the test is significant and hence intercept is significant , as p value 0.003 is less than 0.05
f ) use the coeff to calculate the equation as
consumption = 860.2 + 0.672*size , now put the value of size as 2200 in the equation , we get the consumption value as
=860.2 + 0.672*2200 = 2338.6
g) It means that the B1 coefficient is significant in explaining the model variation
h) as the R2 value is 0.809 , it means that the model is able to explain 81% of the variability , also both the variables are signifcant as the p value is less than 0.05 , so overall the model quality is good enough
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