164 Indians CHAPTER 4 REGRESSION MODELS 9 (a) Develop a regression model to predict the price of stock 1 based on the Dow Jones Industrial Average. (b) Develop a regression model to predict the price of stock 2 based on the Dow Jones Industrial Average. KID 4-32 The closing stock price for each of two stocks was recorded over a 12-month period. The clos- ing price for the Dow Jones Industrial Average (DJIA) was also recorded over this same time pe- riod. These values are shown in the following table: STOCK 1 STOCK 2 48.5 48.2 44.5 44.7 49.3 49.3 46.1 46.2 47.7 48.3 47.0 47.9 47.8 MONTH 1 2 3 4 5 6 7 8 9 10 11 12 13 DJIA 11,168 11,150 11,186 11,381 11,679 12,081 12,222 12,463 12,622 12,269 12,354 13,063 13,326 32.4 31.7 31.9 36.6 36.7 38.7 39.5 41.2 43.3 39.4 40.1 42.1 45.2
164 Indians CHAPTER 4 REGRESSION MODELS 9 (a) Develop a regression model to predict the price of stock 1 based on the Dow Jones Industrial Average. (b) Develop a regression model to predict the price of stock 2 based on the Dow Jones Industrial Average. KID 4-32 The closing stock price for each of two stocks was recorded over a 12-month period. The clos- ing price for the Dow Jones Industrial Average (DJIA) was also recorded over this same time pe- riod. These values are shown in the following table: STOCK 1 STOCK 2 48.5 48.2 44.5 44.7 49.3 49.3 46.1 46.2 47.7 48.3 47.0 47.9 47.8 MONTH 1 2 3 4 5 6 7 8 9 10 11 12 13 DJIA 11,168 11,150 11,186 11,381 11,679 12,081 12,222 12,463 12,622 12,269 12,354 13,063 13,326 32.4 31.7 31.9 36.6 36.7 38.7 39.5 41.2 43.3 39.4 40.1 42.1 45.2
Chapter1: Making Economics Decisions
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