Below are results from a regression of expenditures of exported goods on per capita domestic income:
Yt = -261.09 + 0.2453 × Xt
(31.320) ( )
[ ] [16.616]
where Yt is the consumption of imported goods for the U.S., Xt is per capita income, and t is the year 1968 to 1987 (i.e., n = 20). The R2 is equal to 0.9388.
a) Fill in the two blanks where value in parenthesis is standard error, and value in brackets - t-statistic
b) Give your economic and econometric interpretations of the two OLSEs.
c) Is the slope coefficient different from zero? At what significance level? What is the associated p-value?
d) Given the R2 value, do you believe that higher expenditure on exported goods leads to higher personal income? Explain your reasoning.
e) Imagine that R2 were not given. Could you calculate it from the information you have? Explain.