The following model was fitted to data on 32 insurance companies:

where
y` = price-earnings ratio
x1 = size of insurance company assets, in billions of dollars
x2 = dummy variable taking the value 1 for regional companies and 0 for national companies
The numbers in parentheses under the coefficients are the estimated coefficient standard errors.
a. Interpret the estimated coefficient on the dummy variable.
b. Test against a two-sided alternative. the null hypothesis that the true coefficient on the dummy variable is 0.
c. Test, at the 5% level, the null hypothesis β1 = β2 = 0, and interpret your result.

R2 7.62-0.16x, + 123x2 (0.008) (0.496) 0.37