A factory operator hypothesized that his unit output costs (y) depend on wage rate (x1), other input costs (x2), overhead costs (x3), and advertising expenditures (x4). A series of 24 monthly observations was obtained, and a least squares estimate of the model yielded the following results:

The figures in parentheses below the estimated coefficients are their estimated standard errors. What can you conclude from these results?

Transcribed Image Text:

у, 0.75 + 0.24x!! + 0.56x2t-0.32x3t + 0.23x4t (007) (0.12) (0.23) (0.5) R2 0.79 d 0.85