Examp ole: District Sales To test whether sales are related to population and per capita discretionary income Hypothesis pe H0:B1=B2=0 Ha: not both B1 and B2 equal to zero D ecision kule Fora=.05 and d f.=2,12:F05=389 Reject ho if f>3.89 Test statistic F=MSR/MSE=26922/4.74=5679.47 Conclusion Reject ho, sales are related to population and per capita discretionary income Slide16Slide 16 Example: District Sales • To test whether sales are related to population and per capita discretionary income – Hypothesis H0 : β1 = β2 =0 Ha : not both β1 and β2 equal to zero – Decision Rule For  = .05 and d.f. = 2, 12: F.05 = 3.89 Reject H0 if F > 3.89. – Test statistic F = MSR/MSE = 26922/4.74 = 5679.47 – Conclusion Reject H0 , sales are related to population and per capita discretionary income