EBK BUSINESS STATISTICS
EBK BUSINESS STATISTICS
8th Edition
ISBN: 9780135179833
Author: STEPHAN
Publisher: VST
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Use the Financial database from “Excel Databases.xls” on Blackboard.  Use Total Revenues, Total Assets, Return on Equity, Earnings Per Share, Average Yield, and Dividends Per Share to predict the average P/E ratio for a company.  Use Excel to develop the multiple linear regression model.  Assume a 5% level of significance.   Which independent variable is the strongest predictor of the average P/E ratio of a company?     A. Total Revenues B. Average Yield C. Earnings Per Share D.Return on Equity E. Total Assets F.Dividends Per Share   Company Type Total Revenues Total Assets Return on Equity Earnings per Share Average Yield Dividends per Share Average P/E Ratio AFLAC 6 7251 29454 17.1 2.08 0.9 0.22 11.5 Albertson's 4 14690 5219 21.4 2.08 1.6 0.63 19 Allstate 6 20106 80918 20.1 3.56 1 0.36 10.6 Amerada Hess 7 8340 7935 0.2 0.08 1.1 0.6 698.3 American General 6 3362 80620 7.1 2.19 3 1.4 21.2 American Stores 4 19139 8536 12.2 1.01 1.4 0.34 23.5 Amoco 7 36287…
According to human capital theory, a person’s earning is linked to her level of education – there is a relationship between workers income and years of education. Using data from the Labour Force Survey, a researcher found the following regression results for earnings on intercept, years of education, experience, and experience squared:                         Earnings =    5.24  +  0.035 educ + 0.165 exper – 0.003 exper2                                            (2.45)      (0.012)                 (0.031)               (0.001)      Construct a 95% confidence interval for the effect of years of education on earnings  ?                                                                                                                                                                           2. Consider an individual with 8 years of experience. What would you expect to be the return to two (2) additional years of experience (the effect on earnings)?    3. According to economic theory,…
Why the regression line is a straight line rather than a curved line?
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