7. You work for the California Department of Water Resources. Your job is to predict the...

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7. You work for the California Department of Water Resources. Your job is to predict the quantity of water demanded in Los Angeles in 2016 (HO measured in acre-feet). Based on historical data you estimate the following regression: HO = a + B price + population + B3 rainfall + B B B3 Coeff. 94,000 4,800 0.6 -4,000 t-stat 3.1 1.8 1.2 -2.2 Predict water consumption in Los Angeles, which has a population of 4 million and is expected to get 10 inches of rainfall. The expected price of one acre-foot of water is $55. 8. Place an X in rightmost column for variables that are statistically significant at the 95% confidence level. (5 points) Intercept X variable 1 X variable 2 X variable 3 X variable 4 Coefficient 12 2.8 27 195 15 Standard Error 4 2 23 55 18 t-stat 1.40 3.55 0.83 Statistically significant? 7. You work for the California Department of Water Resources. Your job is to predict the quantity of water demanded in Los Angeles in 2016 (HO measured in acre-feet). Based on historical data you estimate the following regression: HO = a + B price + population + B3 rainfall + B B B3 Coeff. 94,000 4,800 0.6 -4,000 t-stat 3.1 1.8 1.2 -2.2 Predict water consumption in Los Angeles, which has a population of 4 million and is expected to get 10 inches of rainfall. The expected price of one acre-foot of water is $55. 8. Place an X in rightmost column for variables that are statistically significant at the 95% confidence level. (5 points) Intercept X variable 1 X variable 2 X variable 3 X variable 4 Coefficient 12 2.8 27 195 15 Standard Error 4 2 23 55 18 t-stat 1.40 3.55 0.83 Statistically significant?