The following regression is fitted using variables identified that could be rela
ID: 3182139 • Letter: T
Question
The following regression is fitted using variables identified that could be related to student requested loan amount , LOAN-AMT($) for returning students of a certain University.
LOAN-AMT = + ACCEPT + PREV + OUTS
Where ACCEPT = the percentage of applicants that was accepted by the university, PREV = previous loan amount and OUTS =outstanding loan amount
The data was processed using MNITAB and the following is an extract of the output obtained:
The regression equation is LOAN-AMT = -26780 + 116.00ACCEPT – 4.21PREV + 70.85OUTS
S = 2685 R-Sq = 69.6% R-Sq(adj) = 67.7%
Analysis of Variance
If a F-Test is to be conducted, state the appropriate null and alternative hypotheses for this test.
Predictor Coef StDev T P Constant -26780 6115 * 0.000 ACCEPT 116.00 37.17 3.14 0.003 PREV -4.21 14.12 -0.30 ** OUTS 70.85 15.77 4.49 0.000Explanation / Answer
The null hypothesis is that the model is not signficant, that is, it is not able to explain the variability in loan amount based on the given explanatory variables.
The alternate hypothesis is that the model is significant, thts is. it is able to explain the variability in loan amount based on the given explanatory variables.
Thanks.