Question

A group of randomly selected 85 automobile dealers across the automobile industry was surveyed and information about their advertisement expenditure and the total number of cars they sold in particular year was collected. The estimated OLS regression is: Q=3.4+0.09E, where Qi and E denote the quantity of automobiles sold by the ith dealer and their advertisement expenditure, respectively. Calculations show that the regression R 0.45 and 85 Σ (4-02. =841.23. j-1 Based on the given information, the standard error of regression is (Round your answer to two decimal places.) Which of the following statements hold true about the standard error of regression?

A. The standard error of the regression and the regressor have the same measure of unit.
B. The standard error of the regression and the dependent variable are measured in the same unit.
C. The standard error of the regression is an estimator of the standard error of the dependent variable
D. The standard error of the regression is an estimator of the standard deviation of the regression error.

Answer 1

The standard error of regression is an estimator of the standard deviation of the regression error.

Step-by-step explanation:

The standard error of regression is an estimator of the standard deviation of the regression error. It measures the average distance between the actual values of the dependent variable and the predicted values by the regression line. In this case, the standard error of regression is not the same as the measure of unit for the regressor or the dependent variable.