Question: The gross domestic product GDP is an important measure of

The gross domestic product (GDP) is an important measure of the overall economic strength of a country. GDP per capita makes comparisons between different size countries more meaningful. A researcher looking at GDP fit the following model based on an educational variable, Primary School Completion Rate (%), and finds:
Dependent variable is: GDP per Capita
R squared = 3.44%
s = 15945.46 with 96 - 1 = 95 df
a) Explain to the researcher why, on the basis of the regression summary, she might want to consider other predictor variables in the model.
b) Explain why you are not surprised that the sign of the slope is positive.
The researcher adds two variables to the regression and finds:
c) Explain how the slope of Primary completion rate can now be negative.

  • CreatedMay 15, 2015
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