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The CDC provides smoking data for each state. The dataset we'll consider here contains information about the proportion of people in each state who smoked

The CDC provides smoking data for each state. The dataset we'll consider here contains information about the proportion of people in each state who smoked in 2010. We also have information on the tax per pack of cigarettes (in dollars) in each state in 2010. The table below shows the results of a linear regression predicting the proportion (not percent) of smokers in a state with the tax per pack of cigarettes (in dollars).

estimate standard error
intercept .15 .01
cigarette tax (per pack) -.02 .004

(a) Based on these estimates, what would you predict would be the proportion of a state's residents who smoke if their cigarette tax was zero?

(b) Based on these estimates, what would you predict would be the proportion of a state's residents who smoke if their cigarette tax was one dollar?

(c) Conduct a formal hypothesis test at the .05 significance level of whether the true coefficient on cigarette tax is equal to zero. Be sure to clearly define your null and alternative hypotheses, calculate your test statistic value, and explain what you conclude. (Note: even though we have only 50 observations, you can assume we have a large enough number of observations so that you don't have to worry about degrees of freedom - i.e. you can use a normal distribution).

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