Jensen, Solberg, and Zorn investigated the relationship of insider ownership, debt, and dividend policies in companies. One of their findings was that firms with high insider ownership choose lower levels of both debt and dividends. Shown here is a sample of data of these 3 variables for 11 different industries. Use the data to develop the equation of the regression model to predict insider ownership by debt ratio and dividend payout. Insider Debt Dividend Industry Ownership Ratio Payout Mining 8.2 14.2 10.4 Food and Beverage 18.4 20.8 14.3 Furniture 11.8 18.6 12.1 Publishing 28.0 18.5 11.8 Petroleum refining 7.4 28.2 10.6 Glass and cement 15.4 24.7 12.6 Motor vehicle 15.7 15.6 12.6 Department store 18.4 21.7 7.2 Restaurant 13.4 23.0 11.3 Amusement 18.1 46.7 4.1 Hospital 10.0 35.8 9.0 (Round all answers to 4 decimal places, e.g. 1.7589.) The regression model is: Insider Ownership = Debt Ratio - Dividend Payout

Glencoe Algebra 1, Student Edition, 9780079039897, 0079039898, 2018
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Jensen, Solberg, and Zorn investigated the relationship of insider ownership, debt, and dividend policies in companies.
One of their findings was that firms with high insider ownership choose lower levels of both debt and dividends. Shown
here is a sample of data of these 3 variables for 11 different industries. Use the data to develop the equation of the
regression model to predict insider ownership by debt ratio and dividend payout.
Insider
Debt Dividend
Industry
Ownership Ratio
Payout
Mining
8.2
14.2
10.4
Food and Beverage
18.4
20.8
14.3
Furniture
11.8
18.6
12.1
Publishing
28.0
18.5
11.8
Petroleum refining
7.4
28.2
10.6
Glass and cement
15.4
24.7
12.6
Motor vehicle
15.7
15.6
12.6
Department store
18.4
21.7
7.2
Restaurant
13.4
23.0
11.3
Amusement
18.1
46.7
4.1
Hospital
10.0
35.8
9.0
(Round all answers to 4 decimal places, e.g. 1.7589.)
The regression model is:
Insider Ownership =
Debt Ratio -
Dividend Payout
Transcribed Image Text:Jensen, Solberg, and Zorn investigated the relationship of insider ownership, debt, and dividend policies in companies. One of their findings was that firms with high insider ownership choose lower levels of both debt and dividends. Shown here is a sample of data of these 3 variables for 11 different industries. Use the data to develop the equation of the regression model to predict insider ownership by debt ratio and dividend payout. Insider Debt Dividend Industry Ownership Ratio Payout Mining 8.2 14.2 10.4 Food and Beverage 18.4 20.8 14.3 Furniture 11.8 18.6 12.1 Publishing 28.0 18.5 11.8 Petroleum refining 7.4 28.2 10.6 Glass and cement 15.4 24.7 12.6 Motor vehicle 15.7 15.6 12.6 Department store 18.4 21.7 7.2 Restaurant 13.4 23.0 11.3 Amusement 18.1 46.7 4.1 Hospital 10.0 35.8 9.0 (Round all answers to 4 decimal places, e.g. 1.7589.) The regression model is: Insider Ownership = Debt Ratio - Dividend Payout
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