Productivity. How strong is the association between labor productivity and labor costs? Data from the Bureau of Labor Statistics, specifically 2006 index values (computed using 1997 as the base year) for labor productivity and unit labor costs across 53 industries, are used to examine this relationship

(ftp://ftp.bls.gov; accessed May 2008). Here are the results of a regression analysis where the response variable is Labor Productivity.

a) Is there evidence of a linear association between Labor Productivity and Unit Labor Costs? Write appropriate hypotheses.

b) Test your null hypothesis and state an appropriate conclusion (assume that assumptions and conditions are met).

Transcribed Image Text:

Predictor Coeff SE(Coeff) t-ratio P-value Intercept 212.67 12.18 17.46 <0.0001 Unit Labor Cost -0.768 0.111 -6.92 <0.0001 s = 14.39 R-Sq = 48.4%