Question: A firm is experiencing theft problems at its warehouse. A consultant to the firm believes that the dollar loss from theft each week ( T

A firm is experiencing theft problems at its warehouse. A consultant to the firm believes that the dollar loss from theft each week (T) depends on the number of security guards (G) and on the unemployment rate in the county where the warehouse is located (Umeasured as a percent). In order to test this hypothesis, the consultant estimated the regression equationT=a+bG+cUand obtained the following results:

A firm is experiencing theft problems at its warehouse. A consultant to

DEPENDENT VARIABLE: T R-SQUARE F-RATIO P-VALUE ON F OBSERVATIONS: 27 0.7793 42.38 0.0001 PARAMETER STANDARD VARIABLE ESTIMATE ERROR T-RATIO P-VALUE INTERCEPT 5150.43 1740.72 2.96 0.0068 G -480.92 130.66 -3.68 0.0012 211.0 75.0 2.81 0.0096

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