In terms of the model parameters, state the null hypothesis that, after controlling for sales and roe, ros has no effect on CEO salary. State the alternative that better stock market performance increases a CEO’s salary. Consider an equation to explain salaries of CEOs in terms of annual firm sales, return on equity (roe,in percentage form), and return on the firm's stock (ros, in percentage form):log(salary) = Po + P₁ log(sales) + B₂roe + B3ros + μUsing the data in CEOSAL1, the following equation was obtained by OLS:log(salary) = 4.32 +0.28 log(sales) + 0.0174roe + 0.00024ros(0.0041) (0.00054)(0.32) (0.035)n = 209, R² = 0.283

Solution: The population regression equation is log(Salary)=β0+β1log(sales)+β2roe+β3ros

n terms of the model parameters, state the null hypothesis that, after controlling for sales and roe, ros has no effect on CEO salary. State the alternative that better stock market performance increases a CEO’s salary.

n terms of the model parameters, state the null hypothesis that, after controlling for sales and roe, ros has no effect on CEO salary. State the alternative that better stock market performance increases a CEO’s salary.

College Algebra

1st Edition

ISBN:9781938168383

Author:Jay Abramson

Publisher:Jay Abramson

Chapter6: Exponential And Logarithmic Functions

Section6.7: Exponential And Logarithmic Models

Problem 19TI: Does a linear, exponential, or logarithmic model best fit the data in Table 2? Find the model.

See similar textbooks

Related questions

Q: regression analysis should limited in an applied business setting

A: Regression analysis method can be used to establish relationship between different variables by…

Q: When would a survival analysis model be used instead of a logistic regression model?

A: We always use a logistic regression model when we have a dependent variable which is Dichotomous…

Q: Develop a model to test the hypothesis that location is the most important factor in determing the…

A: The following steps would be taken in order to create an econometric model to examine the claim that…

Q: What is Interaction and simple effects?

A: Interaction effects and main effects are commonly used in factorial experiments, ANOVA and…

Q: What is the equation for the regression line that predicts home equity using credit score as the…

A: Solution: Given information: The dependent variable (y) is Home Equity The independent or…

Q: A researcher conducted a study about the hemoglobin levels among menopausal and non-menopausal…

A: The question is about logistic regression.Given :Coefficient estimate of intercept ( b0 ) =…

Q: Discuss the use of the V-model for predicting the lifetime of product reliability.

A: V model is a software development life cycle methodology , which minimizes project risks, guarantees…

Q: Apple CAPM Data file posted on has data about the monthly return on Apple Inc. from 1981 to 2005…

A: To address the given task, we need to analyze the monthly return data for Apple Inc. from 1981 to…

Q: Disposable Personal Income (billions of U.S. dollars) & At the end oN 201 the US Nureau of onomi…

A: In simple sentence, Correlation is nothing but a linear relationship between two variables in which,…

Q: Could you please teel me why should a firm, for profit, care not only about the expected profit, but…

A: Given that Could you please teel me why should a firm, for profit, care not only about the…

Q: A researcher aims to assess the associative impact of coffee consumption on death rates from heart…

A: Let us denote X=yearly coffee consumption in litres and Y=Death from heart diseases. X Y 2.5…

Q: negative linear correlation, the slope of the least-squares line is negative

A: The general form of the regression line is: Y^=a+bXY Where Y^ is the predicted value, 'a' is the…

Q: What does it mean when one of the two main effects is significant?

A: Given problem Given that What does it mean when one of the two main effects is significant ?

Q: Use the Financial database from “Excel Databases.xls” on Blackboard. Use Total Revenues, Total…

A: Given information: The data represents the values of the dependent variable Average P/E Ratio and…

Q: An apps developer for Fintech has commissioned a consultant firm to understand the desired features…

A: (independent variable) and the perception of use (dependent variable), we can perform a simple…

Q: What are the Different Problems Caused by Stochastic Trends?

Q: Define Dynamic effects and the distributed lag model?

Q: As large U.S. companies flattened their management hierarchies during the 1990s, many of the middle…

A: From the given data writing all the data of type of franchise and number of new franchises we get…

Question

In terms of the model parameters, state the null hypothesis that, after controlling for sales and roe, ros has no effect on CEO salary. State the alternative that better stock market performance increases a CEO’s salary.

Consider an equation to explain salaries of CEOs in terms of annual firm sales, return on equity (roe,
in percentage form), and return on the firm's stock (ros, in percentage form):
log(salary) = Po + P₁ log(sales) + B₂roe + B3ros + μ
Using the data in CEOSAL1, the following equation was obtained by OLS:
log(salary) = 4.32 +0.28 log(sales) + 0.0174roe + 0.00024ros
(0.0041) (0.00054)
(0.32) (0.035)
n = 209, R² = 0.283

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Trending now

This is a popular solution!

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Similar questions

Enter the data from Table 2 into a graphing calculator and graph the ranking scatter plot. Determine whetherthe data from the table would likely represent a function that is linear, exponential, or logarithmic.
What might a scatterplot of data points look like if it were best described by a logarithmic model?
What is the y -intercept on the graph of the logistic model given in the previous exercise?
Use log21=0,log22=1, and log24=2 to estimate log23.
Table 6 shows the population, in thousands, of harbor seals in the Wadden Sea over the years 1997 to 2012. a. Let x represent time in years starting with x=0 for the year 1997. Let y represent the number of seals in thousands. Use logistic regression to fit a model to these data. b. Use the model to predict the seal population for the year 2020. c. To the nearest whole number, what is the limiting value of this model?
Explain why the values of an increasing exponentialfunction will eventually overtake the valuesof anincreasing linear function.
The half-life of plutonium-244 is 80,000,000 years. Find function gives the amount of carbon-14 remaining as a function of time, measured in years.
In 2014, Chile experienced an intense earthquake with a magnitude of 8.2 on the Richter scale. In 2014, Los Angeles also experienced an earthquake which measured 5.1 on the Richter scale. Compare the intensities of the two earthquakes.
Why is the data lognormal
The median starting salary for new law graduates is determined by log(salary) = B, + B,LSAT + B2GPA + B3log(libvol) + B4log(cost) + Bgrank 1+ E where LSAT is the median LSAT score for the graduating students, GPA is the median university GPA for the class, libvol is the number of volumes in the institution law library, cost is the annual cost of attending university to read law, and rank is a ranking for the institution offering the law degree (with rank 5 1 being the best).
Bacteria growth was measured over a one-month period. Scatterplot A displays the number of cells measured over the recorded number of days. Two transformations of the data are shown in the next two graphs. Scatterplot B displays the relationship between the number of days and the natural log of the number of cells of bacteria. Scatterplot C displays the relationship between the natural log of the number of days and the natural log of the number of cells of bacteria. Which model best represents the relationship between the number of days and the number of cells of bacteria? A linear model would best represent the relationship because scatterplot A is fairly linear. An exponential model would best represent the relationship because scatterplot B is fairly linear. A linear model would best represent the relationship because scatterplot B is fairly linear. A power model would best represent the relationship because scatterplot C is fairly linear.
Calculate the value of A = A A = log, 4-