Based on the output below from regression analysis performed to develop a model

Question

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), at alpha 0.05, what can be concluded? The regression equation is PE - 8.04+0.757 Growth Rate+0.0516 Profit Margin+2.09 Green Predictor Constant Growth Rate .7569 0.1355 5.59 0.000 Profit Margin 0.05162 0.03239 1.59 0.1319 Green? s = 1 12583 R-Sq = 87.8% Coef SE Coef TP 8.043 1.570 5.12 0.000 2.0900 0.7945 2.63 0.023 A. Whether or not a firm is Green is insignificant in predicting its PE ratio. B. That the regression coefficient associated with Growth Rate is significantly diferent from zero. o C. That Profit Margin is a significant variable in predicting a firm's PE ratio. D. That the regression coefficient associated with Profit Margin is significantly different from zero.

Explanation / Answer

Correct Answer:Option (B) The regression coefficient associated with growth rate is significantly different form zero

since p-value of growth rate = 0.000 < alpha 0.05

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