HP HP-15C - Least-Squares Using Successive Rows

140 Section 4: Using Matrix Operations
The Reg SS for the UR variable adjusted for the PPI variable and
the constant term is
(Reg SS for full model) - (Reg SS for reduced model) =
3.274630500.
Now construct the following ANOVA table:
_ Degrees of Sum of
Source "
Freedom Squares
UR| PPI, Constant
PPI | Constant
Constant
Residual (full
model)
Total
1
1
1
8
11
3.2746305
51.2986490
533.4145457
13.5121750
601.5000002
Mean
Square
3.2746305
51.2986490
533.4145457
1.68902188
F Ratio
1.939
30.37
315.8
The F ratio for the unemployment rate, adjusted for the producer
price index change and the constant is not statistically significant
at the 10-percent significance level (a = 0.1). Including the
unemployment rate in the model does not significantly improve the
CPI fit.
However, the F ratio for the producer price index adjusted for the
constant is significant at the 0.1-percent level (a — 0.001). Including
the PPI in the model does improve the CPI fit.
Least-Squares Using Successive Rows
This program uses orthogonal factorization to solve the least-
squares problem. That is, it finds the parameters 61; ..., bp that
minimize the sum of squares ||r||^ = (y — Xb)r(y — Xb) given the
model data