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Use the information below to answer Q15 to Q17. The researcher is interested in a nonlinear relationship between nettfa and age. The squared of age
Use the information below to answer Q15 to Q17. The researcher is interested in a nonlinear relationship between nettfa and age. The squared of age (denoted agesq) is incorporated in regression (3) and the regression output is shown below. nettfa = bo + bjinc + bage + byage' + bymarr + bymale +e ($) Dependent Variable: NETTFA Method: Least Squares Date: 08/23/22 Time: 20:14 Sample: 1 9275 Included observations: 0275 Variable Coefficient Std. Error t-Statistic Prob AGE -2.202841 0.488756 -4.601178 0.0000 AGESQ 0.038548 0.005608 8.873641 0.0000 INC 1.051259 0.027311 38.49233 0.0000 MARR -10.03498 1.438685 -8.984818 0.0000 MALE 0.042643 1 818610 0.028345 0.9790 C 9.151992 10.13077 0.903386 0.3683 R-squared 0.178077 Mean dependent var 19.07168 Adjusted R-squared 0.177634 S.D. dependent var 63.96384 S.E. of regression 58.00523 Akaike info criterion 10.95959 Sum squared resid 31186534 Schwarz criterion 10.96421 Log likelihood -50819.10 Hannan-Quinn criter. 10.96116 F-statistic 401.6431 Durbin-Watson stat 1.928681 Prob(F-statistic) 0.000000 Q15. Between models (3) and (5), which is the preferred model? Explain. [2] Q16. At what age is the net financial wealth maximised? Show your working. [2] Q17. State the name of the test that you can perform to determine whether a linear regression or a nonlinear regression is a better fit for the data. [2]
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