Solved

Based on the Output Below from Regression Analysis Performed to Develop

Question 29

Multiple Choice

Based on the output below from regression analysis performed to develop a model for predicting a firm's Price-Earnings Ratio (PE) based on Growth Rate, Profit Margin,
And whether or not the firm is Green (1 = Yes, 0 = No) , we can conclude (α = .05)
That The regression equation is
PE=8.04+0.757\mathrm { PE } = 8.04 + 0.757 Growth Rate +0.0516+ 0.0516 Profit Margin +2.09+ 2.09 Green?
 Predictor  Coef  SE Coef  T  P  Constant 8.0431.5705.120.000 Growth Rate 0.75690.13555.590.000 Profit Margin 0.051620.032391.590.139 Green? 2.09000.79452.630.023 S=1.12583RSq=87.8\begin{array} { l r r r r } \text { Predictor } & \text { Coef } & \text { SE Coef } & \text { T } & \text { P } \\ \text { Constant } & 8.043 & 1.570 & 5.12 & 0.000 \\ \text { Growth Rate } & 0.7569 & 0.1355 & 5.59 & 0.000 \\ \text { Profit Margin } & 0.05162 & 0.03239 & 1.59 & 0.139 \\ \text { Green? } & 2.0900 & 0.7945 & 2.63 & 0.023 \\ \mathrm {~S} = 1.12583 & \mathrm { R } - \mathrm { Sq } = 87.8 \end{array}


A) Growth Rate is not a significant variable in predicting a firm's PE ratio.
B) Profit Margin is a significant variable in predicting a firm's PE ratio.
C) The regression coefficient associated with Growth Rate is not significantly
Different from zero.
D) Whether or not a firm is Green is significant in predicting its PE ratio.
E) The regression coefficient associated with Profit Margin is significantly different
From zero.

Correct Answer:

verifed

Verified

Unlock this answer now
Get Access to more Verified Answers free of charge

Related Questions