Continuing again w ith the example o f expenditure on food, let the estimated re g re s s io n be w ith the standard error o f the estimate, se = 0.20.

a. W hat is the predicted expenditure on food fo r an in d ivid u a l whose incom e is

$2 0 ,0 0 0 ?

b. W hat is the predicted value i f incom e increases to $21,000?

c. Interpret the slope coefficient, b 1 = 0.00005.