SUMMARY OUTPUT

Regression Statistics
Multiple R 0.995996
R Square 0.992009
Adjusted R 0.991676
Standard Er 11.43163
Observatio 51

ANOVA
df SS MS F Significance F
Regression 2 778678.5 389339.3 2979.283 4.60E-051
Residual 48 6272.745 130.6822
Total 50 784951.3

Coefficients
Standard Error t Stat P-value Lower 95% Upper 95%Lower 95.0%
Intercept 25.57128 9.831432 2.600972 0.012322 5.803857 45.33869 5.803857
seniors x1 -2.130087 0.761321 -2.797883 0.007382 -3.660825 -0.599348 -3.660825
exphlth x2 6.98425 0.090486 77.18584 5.31E-052 6.802315 7.166184 6.802315

RESIDUAL OUTPUT

Observation
Predicted income
Residuals
1 9.323612 -0.023612
2 10.47963 0.720374
3 27.16863 -10.06863
4 27.18512 -13.38512
5 8.161161 2.738839
6 14.9426 0.357395
7 7.899241 4.900759
8 11.71599 2.884009
9 16.49694 4.70306
10 16.33939 2.960611
11 24.33287 0.767126
12 24.98937 2.410629
13 20.36602 2.933983
14 28.0973 3.502703
15 26.05474 5.645257
16 29.22524 -2.825242
17 29.27809 0.121906
18 35.37464 -5.374644
19 36.30072 2.499275
20 44.17535 6.124655
21 42.15674 -3.256744
22 43.82631 7.773692
23 52.04309 6.956908
24 52.76245 2.237553
25 80.85665 11.44335
26 74.57386 2.026135
27 63.71005 -2.510051
28 71.04362 -6.943622
29 71.30561 -0.005608
30 82.1102 -10.5102
31 92.39432 -21.09432
32 97.86662 -2.966622
33 107.7666 10.73337
34 98.3137 1.586299
35 111.472 -17.57196
36 106.7158 -4.315841
37 106.527 7.973018
38 113.0679 -3.467852
39 159.3282 -12.42817
40 118.6516 21.54843
41 144.4688 -11.56875
42 126.3449 3.455112
43 176.3837 34.81634
44 188.6828 6.017203
45 230.9062 -13.00618
46 241.4139 22.1861
47 281.9089 -25.90893
48 298.9229 -15.52287
49 351.7718 -6.771767
50 465.8423 -15.24234
51 660.755 22.74499
Upper 95.0%
45.33869
-0.599348
7.166184
SUMMARY OUTPUT

Regression Statistics
Multiple R 0.455462
R Square 0.207445
Adjusted R 0.156857
Standard Er 10.28477
Observatio 51

ANOVA
df SS MS F Significance F
Regression 3 1301.252 433.7505 4.100634 0.011511
Residual 47 4971.494 105.7765
Total 50 6272.745

Coefficients
Standard Error t Stat
Intercept -23.53115 11.10164 -2.11961
seniors x1 1.948002 0.881823 2.209063
exphlth x2 1.464449 0.425393 3.442581
x1x2 -0.120419 0.034333 -3.507407
P-value Lower 95% Upper 95%Lower 95.0%
0.039349 -45.86478 -1.197531 -45.86478
0.032081 0.174003 3.722001 0.174003
0.001221 0.608669 2.320228 0.608669
0.001007 -0.189487 -0.05135 -0.189487
 nr2 10.37227
0.005594

Upper 95.0%
-1.197531
3.722001
2.320228
-0.05135
obs income seniors x1 exphlth x2 x1x2
WY 9.3 10.9 0.998 10.8782
VT 11.2 12 1.499 17.988
DC 17.1 13.3 4.285 56.9905
AK 13.8 4.4 1.573 6.9212
ND 10.9 14.8 2.021 29.9108
DE 15.3 12.4 2.26 28.024
SD 12.8 14.7 1.953 28.7091
MT 14.6 13.4 2.103 28.1802
RI 21.2 15.5 3.428 53.134
ID 19.3 11.8 2.277 26.8686
NH 25.1 11.9 3.452 41.0788
HI 27.4 11.7 3.485 40.7745
ME 23.3 13.7 3.433 47.0321
NV 31.6 11.1 3.747 41.5917
NE 31.7 14.2 4.4 62.48
NM 26.4 11 3.878 42.658
WV 29.4 15.3 5.197 79.5141
UT 30 8.9 4.118 36.6502
AR 38.8 15 6.111 91.665
KS 50.3 13.9 6.903 95.9517
MS 38.9 12.5 6.187 77.3375
IA 51.6 15.5 7.341 113.7855
OR 59 13.8 7.999 110.3862
OK 55 13.6 8.041 109.3576
CT 92.3 14.1 12.216 172.2456
CO 76.6 10 10.066 100.66
SC 61.2 11.7 9.029 105.6393
KY 64.1 12.7 10.384 131.8768
AZ 71.3 13.4 10.635 142.509
AL 71.6 13 12.06 156.78
LA 71.3 11.3 13.014 147.0582
MN 94.9 12.6 14.194 178.8444
MD 118.5 11.1 15.154 168.2094
WI 99.9 13.4 14.502 194.3268
TN 93.9 12.8 16.203 207.3984
MO 102.4 14.2 15.949 226.4758
WA 114.5 11.6 15.129 175.4964
IN 109.6 12.7 16.401 208.2927
MA 146.9 14 23.421 327.894
VA 140.2 11 16.682 183.502
GA 132.9 10.1 20.104 203.0504
NC 129.8 12.5 18.241 228.0125
NJ 211.2 13.6 25.741 350.0776
MI 194.7 12.4 27.136 336.4864
OH 217.9 13.3 33.456 444.9648
IL 263.6 12.6 34.747 437.8122
PA 256 15.8 41.521 656.0318
FL 283.4 18.6 44.811 833.4846
TX 345 10.2 49.816 508.1232
NY 450.6 13.1 67.033 878.1323
CA 683.5 10.6 94.178 998.2868
Residuals
-0.023612
0.720374 The White's test
-10.06863
-13.38512
2.738839 _=_0+_1 _1+_2 _2+_3 _3+_
0.357395
4.900759 Step 1: Run a regression model (i) and obtain the re
2.884009 Step 2: Regress the squared residuals (_ )^2 agai
4.70306
2.960611 Step 3: Compute =^2statistic, where n is the
0.767126 2. The LM statistic follows ^2distribution
2.410629 step 2.
2.933983 Step 4: Reject the null and conclude that there is a s
value. Alternatively compute p-value and r
3.502703
5.645257
-2.825242
0.121906
-5.374644
2.499275
6.124655
-3.256744
7.773692
6.956908
2.237553
11.44335
2.026135
-2.510051
-6.943622
-0.005608
-10.5102
-21.09432
-2.966622
10.73337
1.586299
-17.57196
-4.315841
7.973018
-3.467852
-12.42817
21.54843
-11.56875
3.455112
34.81634
6.017203
-13.00618
22.1861
-25.90893
-15.52287
-6.771767
-15.24234
22.74499
+_3 _3+_

(i) and obtain the residuals (_ ) .

siduals (_ )^2 against a constant, _1, _ 2, _(3, ) _1_2and _2 _(3, )

atistic, where n is the number of observations used in order to estimate the auxillary regression in step
ows ^2distribution with1 degrees of freedom, where k is the number of independent variables used in

clude that there is a significant degree of heteroscedasticity when LM statistic is greater than the critical
mpute p-value and reject the null if the p-value is less than the level of significance (usually = 0.05).
sion in step
riables used in

an the critical
ally = 0.05).