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Basic Question 4 of 7

A regression equation that is derived from ten historical observations is given as follows:

If the standard error of the y-intercept is 1.26 and the standard error of the regression coefficient is 0.58, using a 10% significance level, which of the following statements would be incorrect?

A. The lower limit of the estimate for the y-intercept is -0.55, and the upper limit is 4.13.
B. The upper limit of the estimate for the regression coefficient is 1.98.
C. The lower limit of the estimate for the regression coefficient is 0.45.
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User Contributed Comments 10

User Comment
Danny20082 The question did not specify the number of observations.
MonkeySee First line:

"A regression equation that is derived from ten historical observations..."
investoprenuer How can it be B? The isn't the upper limit for b1 2.61. Ans B is 1.98
investoprenuer Sorry.... incorrect....
Got it.
shajidubai how did you get 1.98?
Adi8232 lol, chill guys, looks like stress is making your thinking fuzzy.
shash0678 How did we get 1.98?
bablig The queston says which is incorrect...1.98 is INCORRECT.
ashish100 No chill how did they get 1.86?
zagorny95 t table - look for 10% two tail significance level [5% if 1 tail table] for 8 degrees of freedom - Table gives you the result of 1.86
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I am using your study notes and I know of at least 5 other friends of mine who used it and passed the exam last Dec. Keep up your great work!
Barnes

Barnes

Learning Outcome Statements

describe the use of analysis of variance (ANOVA) in regression analysis, interpret ANOVA results, and calculate and interpret the standard error of estimate in a simple linear regression

CFA® 2025 Level I Curriculum, Volume 1, Module 10.