Comment on the statistical significance of the estimated logit model. The following logit model from J.S Cramer on the household budget survey of980 was based on a sample of 2820 households. The purpose is to determinecar ownership as a function of income. Car ownership was a binary variable:Y=1 if a household owns a car, zero otherwise.-2.7720.348 In IncomeOwn =(-3.35)(4.05)x2 = 16.681 , p – value: 0.000The number in the parentheses are t statistics.

Null Hypothesis: H0: The car ownership is not significantly estimated by the income. Alternative…

The following logit model from J.S Cramer on the household budget survey 980 was based on a sample of 2820 households. The purpose is to determin car ownership as a function of income. Car ownership was a binary variable Y=1 if a household owns a car, zero otherwise. -2.772 + (-3.35) 0.348 In Income Own = (4.05)