1. The following equation was estimated using the data in CEOSAL1:log(salary) = 4.322 + .276 log(sales) + .0215 roe – 00008 roe?(.00026)(.324) (.033)n = 209, R? = .282.(.0129)This equation allows roe to have a diminishing effect on log(salary). Is this generality necessary? Explain why orwhy not.

Ans:(1) By using given data log(salary)^ = 4.322 +0.276 log(sales) + 0.0215 roe - 0.00008roe2…

1. The following equation was estimated using the data in CEOSAL1: log(salary) = 4.322 + .276 log(sales) + .0215 roe (.324) (.033) n = 209, R² = .282. .00008 roe? (.0129) (.00026) This equation allows roe to have a diminishing effect on log(salary). Is this generality necessary? Explain why o why not.

1. The following equation was estimated using the data in CEOSAL1: log(salary) = 4.322 + .276 log(sales) + .0215 roe (.324) (.033) n = 209, R² = .282. .00008 roe? (.0129) (.00026) This equation allows roe to have a diminishing effect on log(salary). Is this generality necessary? Explain why o why not.

Practical Management Science

6th Edition

ISBN:9781337406659

Author:WINSTON, Wayne L.

Publisher:WINSTON, Wayne L.

Chapter7: Nonlinear Optimization Models

Section: Chapter Questions

Problem 63P

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