A Stockbroker is interested in the factors influencing the rate of retum on the common stock of banks. For a sample of 35 banks the following model was estimated Î = 2.37 + 0.85X, + 0.12.X, - 0.10.X; 1= (1.3) (2.3) (1.3) (2.5) R =0.32 RSS =135 Where Y = Percentage rate of retum on common stock of bank, X,= Percentage rate of growth of bank's eamings, X,=percentage rate of growth of bank's assets, X;=Loan losses as percentage of bank's asset Test significance of coefficients of X, X, and X; i. Test overall significance of the model Test that 1. ffigi nta

Glencoe Algebra 1, Student Edition, 9780079039897, 0079039898, 2018
18th Edition
ISBN:9780079039897
Author:Carter
Publisher:Carter
Chapter10: Statistics
Section10.1: Measures Of Center
Problem 9PPS
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Aa
=,三,,审 21
AaBbCcI AaBbCcI AaBbC AaBbCc AaB
I Normal
1 No Spaci. Heading 1
Heading 2
Title
Paragraph
Styles
Assignment
A Stockbroker is interested in the factors influencing the rate of retum on the common
stock of banks. For a sample of 35 banks the following model was estimated
Î = 2.37
+ 0.85.X, + 0.12X, -
0.10.X;
(1.3)
R =0.32
t=
(1.3)
(2.3)
(2.5)
RSS =135
Where Y = Percentage rate of retum on common stock of bank, X,= Percentage rate of
growth of bank's eamings, X,= percentage rate of growth of bank's assets, X,= Loan
losses as percentage of bank's asset
Test significance of coefficients of X, X, and X;
i.
ii.
Test overall significance of the model
Test that coefficients of X,and X, are equal (covariance between coefficients of
X, and X, is -0.002)
ii.
iv.
Test that coefficient of X, is equal to 1
Suppose stockbroker imposes restriction that coefficients of X, and X, sum to
land re estimates the model and find new RSS = 140. Is his restriction valid?
V.
W
Transcribed Image Text:Aa =,三,,审 21 AaBbCcI AaBbCcI AaBbC AaBbCc AaB I Normal 1 No Spaci. Heading 1 Heading 2 Title Paragraph Styles Assignment A Stockbroker is interested in the factors influencing the rate of retum on the common stock of banks. For a sample of 35 banks the following model was estimated Î = 2.37 + 0.85.X, + 0.12X, - 0.10.X; (1.3) R =0.32 t= (1.3) (2.3) (2.5) RSS =135 Where Y = Percentage rate of retum on common stock of bank, X,= Percentage rate of growth of bank's eamings, X,= percentage rate of growth of bank's assets, X,= Loan losses as percentage of bank's asset Test significance of coefficients of X, X, and X; i. ii. Test overall significance of the model Test that coefficients of X,and X, are equal (covariance between coefficients of X, and X, is -0.002) ii. iv. Test that coefficient of X, is equal to 1 Suppose stockbroker imposes restriction that coefficients of X, and X, sum to land re estimates the model and find new RSS = 140. Is his restriction valid? V. W
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