D. $110.57 2. In simple regression, the slope represents. (No imaged with questi
ID: 3221906 • Letter: D
Question
D. $110.57
2. In simple regression, the slope represents. (No imaged with question)
D. variation around the line of regression.
3. If the correlation coefficient (r) = 1.00, then
D. there is no explained variation.
4. An investment specialist claims that if one holds a portfolio that moves in the opposite direction to the market index like the S&P 500, then it is possible to reduce the variability of the portfolio's return. In other words, one can create a portfolio with positive returns but less exposure to risk.
A sample of 26 years of S&P 500 index and a portfolio consisting of stocks of private prisons, which are believed to be negatively related to the S&P 500 index, is collected. A regression analysis was performed by regressing the returns of the prison stocks portfolio (Y) on the returns of S&P 500 index (X) to prove that the prison stocks portfolio is negatively related to the S&P 500 index at a 5% level of significance. The results are given in the following EXCEL output.
D. You cannot reject the null hypothesis and, therefore, conclude that there is insufficient evidence to show that the prisons stock portfolio and S&P 500 index are negatively related.
A. $193.73 B. $871.33 C. $9341.33D. $110.57
2. In simple regression, the slope represents. (No imaged with question)
A. change in Y per unit change in X. B. predicted value of Y when X = 0. C. the predicted value of Y.D. variation around the line of regression.
Explanation / Answer
Here,
I can only ansswer the 4th question because for 1,2 and 3, the regression equation is needed which is not visible in your case. You can type that equation to get the answers of 1, 2 and 3. Similarly, in 5th one, the output image is not visible.
For 4th,
Since p - value is 0.0000 which is less than alpha, reject the null hypothesis. Hence,
You can reject the null hypothesis and, therefore, conclude that there is sufficient evidence to show that the prisons stock portfolio and S&P 500 index are negatively related.
Option C is correct.
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