Ticket prices, part 2. Here's a multiple regression model for the variables considered in Exercise 12:7
Dependent variable is: Receipts($M)
R squared = 99.9% R squared (adjusted) = 99.9% s = 0.0931 with 74 degrees of freedom
Source Sum of Squares df Mean Square F-ratio
Regression 484.789 3 161.596 18634
Residual 0.641736 74 0.008672
Variable Coeff SE(Coeff) t-ratio P-value
Officer Wage in the regression table of Exercise 13.
a) State the standard null and alternative hypotheses for the true coefficient of Police Officer Wage.
b) Test the null hypothesis (at a = 0.05) and state your conclusion.
c) A state senate aide challenges your conclusion. She points out that we can see from the scatterplot and correla- tion (see Exercise 11) that there is almost no linear rela- tionship between police officer wages and violent crime. Therefore, she claims, your conclusion in part a must be mistaken. Explain to her why this is not a contradiction.