Question

Hello, I'm trying to run and interpret multiple regression for the data below. I would like to see which of the 3 independent variables: gdp, wage and population determine the dependent variable FDI of the made up Country Amazon. I want to see if this a good model and the interpretation of P value, F value, R2 and residuals. Please include Anova table and if can reject or accept null hypothesis. Could you please help? I want to see if I did it correctly.

Country Amazon	Year	FDI	GDP	Wage	Population
	2012	301,183,000,000	6,202,570,000,000	39,528	127,629,000
	2013	350,395,000,000	5,162,060,000,000	39,409	127,445,000
	2014	371,184,000,000	4,861,387,000,000	38,763	127,276,000
	2015	401,835,000,000	4,396,761,000,000	38,660	127,141,000
	2016	418,331,000,000	4,959,293,000,000	39,113	126,994,511
	2017	469,047,000,000	4,876,423,000,000	39,095	126,785,797

Answer 1

Please find the solution below:

As the value of R Squared is 0.994... Which is closer to 1... It represents a good fit...

SUMMARY OUTPUT Regression Statistics MultipleFR R Square Adjusted R Square Standard Error Observations 0.99737692 0.994760721 0.986901803 6648061160 6 ANOVA Significance F 5.5943E+21 126.577311 0.00784862 MS Regression Residual Total 1.67829E+22 8.83934E+19 1.68713E+22 4.41967E+19 Coefficients Standard Error Lower 95% Upper 95% Lower 95.0% 1.95044E 12 11.31813051 0.00771616 1.3683E+13 3.04675E+13 1.36833E+13 0.01130174 1.593265558 0.25211946-0.066634140.030620789 0.06663414 16780405.04 1.247067583 0.33860738 51273956.4 93126554.73 51273956.4 P-value Upper 95.0% t Stat 2.20754E+13 -0.018006673 20926299.16 176215.8545 3.04675E+13 0.030620789 93126554.73 117214.8747 Intercept GDP Wage Population 13712.69852 12.85055995 0.00600113-235216.834-117214.8747-235216.834

F value is 126.57

P value is 0.0078

As this value is less than 0.05, so the model is statistically significant...

The Regression Equation will be:

FDI = 2.21 * 10¹³ - 0.018*GDP + 20926299.16*Wage - 176215.85*Population

End of the Solution...