You are an economic analyst examining the factors that impact South Africa’s Gross Domestic Product(GDP). You suspect that the country’s exports and unemployment rate have an impact on the GDP so you run a regression to test this claim. The estimation output is shown below.Using the t-test, test the hypothesis that the LUN and LEXP have no significant effect in GDP at the 1% level of significance and interpret these coefficients. Compute the F-statistic and comment on its significance. What does this mean about the explanatory variables of this model? Interpret the R squared measure. SUMMARY OUTPUTRegression Statistics/Multiple RR²Adjusted R²Standard errorObservations 120ANOVAdf2RegressionResidualTotal1819IStandard errort-statp-valueCoefficients0,67118915531,38553?InterceptLUN0,6065160,011041?0,0915190010,701628791LEXP0,43051?The variables were transformed into log form so they can be interpreted as percentages.LUN= natural log of the Unemployment rate.LEXP = natural log of the country's exports.LGDP = natural log of the country's GDP.0,8901706070,792403710,7808705830,675872845SS31,385538,22247439,6084MS31,385530,456804F?SignificanceF0.45341E Focusboston

1. For testing the individual significance, we will use the t-Test. Variable: LUN Significance…

Answered: You are an economic analyst examining…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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You are an economic analyst examining the factors that impact South Africa’s Gross Domestic Product(GDP). You suspect that the country’s exports and unemployment rate have an impact on the GDP so you run a regression to test this claim. The estimation output is shown below.

Using the t-test, test the hypothesis that the LUN and LEXP have no significant effect in GDP at the 1% level of significance and interpret these coefficients.
Compute the F-statistic and comment on its significance. What does this mean about the explanatory variables of this model?
Interpret the R squared measure.

SUMMARY OUTPUT
Regression Statistics/
Multiple R
R²
Adjusted R²
Standard error
Observations 120
ANOVA
df
2
Regression
Residual
Total
18
19
I
Standard error
t-stat
p-value
Coefficients
0,671189155
31,38553
?
Intercept
LUN
0,606516
0,011041
?
0,091519001
0,701628791
LEXP
0,43051
?
The variables were transformed into log form so they can be interpreted as percentages.
LUN= natural log of the Unemployment rate.
LEXP = natural log of the country's exports.
LGDP = natural log of the country's GDP.
0,890170607
0,79240371
0,780870583
0,675872845
SS
31,38553
8,222474
39,608
4
MS
31,38553
0,456804
F
?
Significance
F
0.45341
E Focus
boston

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