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(Multiple Hypotheses Testing). Suppose a hamburger restaurant is investigating the relationship be- tween the number of burgers it sells in a month, the price
(Multiple Hypotheses Testing). Suppose a hamburger restaurant is investigating the relationship be- tween the number of burgers it sells in a month, the price of a burger in dollars, and the money it spends on advertising in tens of thousands of dollars, and whether or not it is open on Saturdays. Consider the following unrestricted model: Sales 30 +3 Price + 3Advert + 33 Saturdays + . And the restricted model Sales = Bo + B(Advert + Saturdays - Price) + . (a) In terms of the unrestricted model parameters, state the null hypothesis being imposed by the restricted model (something like Ho: 31 232 2033). (b) Interpret this null hypothesis in context. (c) Suppose n = 104 and, after estimating both the restricted and unrestricted models, we find that SSER 1000, SSEU = 800. Use this information the compute the F-statistic. (d) Using the command pf(F*, J. n-p-1) in R, compute the p-value. Recall that: Pr (F(J,n-p-1) c) = pf(c, J,n-p-1). (e) Using this p-value report the result of the test at level a = 0.05. Interpret the test result in the context of the problem.
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