Question

To answer this question, you will have to analyse the dataset 248 countries WBDI.gdt, which can be found in the Assignment Resources section of the module website. The file contains data from the World Bank Indicator set on life expectancy (LE), income measured in purchasing power parity terms to allow for price differences between countries (GNIPPP), health expenditure per person (HEXP), and long term unemployment (LTU). Estimate the model in which life expectancy is a function of long term unemployment and health expenditure per person. What is the value of the F statistic and what does its p-value tell you? Select one: The F stat is over 22 and its p-value is less than 0.05. This indicates that the null hypothesis, that all the coefficients of the dependent variables are equal to zero, cannot be rejected at the 5% significance level. The F statistic is over 22 and its p-value is less than 0.05. This indicates that none of the independent variables in the model are statistically significant at the 5% significance level. The F statistic is over 22 and its p-value is less than 0.05. This indicates that all the coefficients in the model are statistically significant at the 5% significance level. The F statistic is over 22 and its p-value is less than 0.05. This indicates that both independent variables in the model are statistically significant at the 5% significance level. The F statistic is over 22 and its p-value is less than 0.05. This indicates that jointly the independent variables in the model are statistically significant at the 5% significance level.

Answer 1

The F statistic is over 22, and its p-value is less than 0.05. This indicates that both independent variables in the model are statistically significant at the 5% significance level.

Step-by-step explanation:

In regression analysis, the F statistic is used to test the overall significance of the model. In this case, the F statistic being over 22 suggests that the model as a whole is statistically significant. The associated p-value being less than 0.05 further strengthens this indication.

The null hypothesis for the F test is that all the coefficients of the independent variables in the model are equal to zero. A low p-value (less than 0.05) provides evidence to reject this null hypothesis. Therefore, in the context of this question, the F statistic being over 22 and the associated p-value being less than 0.05 imply that at least one of the independent variables (long term unemployment and health expenditure per person) significantly contributes to explaining the variation in life expectancy.

It's important to note that a low p-value for the F statistic doesn't provide information about the individual significance of each independent variable. For that, one would need to look at the t-statistics and their associated p-values for each coefficient. However, in the context of the given options, the correct choice is the one stating that both independent variables in the model are statistically significant at the 5% significance level based on the F statistic and its p-value.