Portfolio Benchmark22.00%16.00%-7.50%-2.30%8.63%17.88%21.25%-9.63%-3.88%3.25%9.15%11.21%9.63%15.25%6.25%-37.00%15.00%5.75%-42.00%13.75%An analyst is trying to understand the variation of portfolio returns shown in the left column by analyzing the variation of benchmarkreturns in the right column. Here, the analyst uses the benchmark returns as the explanatory variable, i.e., the x-variable, to explain thevariation of portfolio returns, the y -variable. The analyst performs a regression analysis between the x and y variables.The y-intercept and slope coefficient of the x-variable are 0.013 and .892, respectively. If the benchmark return is 14%, the regressionmodel will estimate the portfolio return closest toO 0%89.2%1.3%O 13.79%

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Answered: The y-intercept and slope coefficient…

Linear Algebra: A Modern Introduction

4th Edition

ISBN:9781285463247

Author:David Poole

Publisher:David Poole

Chapter4: Eigenvalues And Eigenvectors

Section4.6: Applications And The Perron-frobenius Theorem

Problem 22EQ

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The y-intercept and slope coefficient of the x-variable are 0.013 and .892, respectively. If the benchmark return is 14%, the regression model will estimate the portfolio return closest to