A company finds that the number of times per year that an employee makes use of their company-sponsored insurance is a linear function of their age group:
Y = 12.4 - 10.9 X1 - 9.8 X2 - 6.5 X3 - 3.1 X4
where X1, X2, X3, and X4 are 20-29 year olds, 30–39 year olds, 40–49 year olds, and 50–59 year olds (the 60+ year olds have been omitted). What is the predicted number of annual insurance usages per group?
Beginning with the omitted category, the 60+ category is defined by the constant, and they expect 12.4 uses per year. The 20–29 year olds are defined by X1, so that their value is 12.4 - 10.9 = 1.5 usages per year. Likewise, the 30–39 category will have 2.6 usages, the 40–49 category
5.9 usages, and the 50–59 category 9.3 usages.
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