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In a study conducted for the National Institute for Occupational Safety
and Health, data was collected to produce a 50-state model for determining
revenue needs for long term care for elderly coal miners with Black Lung
disease. The model which provided the best prediction for actual dollars
spent on long term care for Black Lung was based on the number of miners
over 65, the total coal production in the state, and the per capita income,
all of which were hypothesized to contribute positively to black
Lung health care expenditures. The state expenditures are measured as
expenditures in millions of 1998 dollars.
(Hints: there are more than six problems, but you only need to identify six.)
Table 1.
Regression Analysis on Health Care for Elderly Miners
Intercept % of Pop. Per capita Total Coal
Over 60 Income Production
(1000$) (million tons)
16 19.5 -171.2 -1.9
(2.3) (0.02) (2.7)
Adjusted r2 = 1.02 F=4.6 P(F) = -.00513
The analyst decided that there was no way that any Black lung expenditures
could be less than $1.6 million per year, and that the coefficient for Per
Capita income proved that rich states were stingy. The probability of these
results being correct was 1.02. From the estimated coefficients,
increasing per capita income will have a greater impact on black lung
expenditures than total coal production. Lastly, the best way to hold down
black lung expenditures was to stop mining coal.
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