Stock market analysts are continually looking for reliable predictors of stock prices. Consider the problem of modeling

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Stock market analysts are continually looking for reliable predictors of stock prices. Consider the problem of modeling the price per share of electric utility stocks (Y). Two variables thought to influence this stock price are return on average equity (X1) and annual dividend rate (X2). The stock price, returns on equity, and dividend rates on a randomly selected day for 16 electric utility stocks are provided in the file P10_19.xlsx.
a. Estimate a multiple regression equation using the given data. Interpret each of the estimated regression coefficients.
b. Interpret the standard error of estimate se, R2, and the adjusted R2. Does it appear that predictions of price from this equation will be very accurate?

Stocks
Stocks or shares are generally equity instruments that provide the largest source of raising funds in any public or private listed company's. The instruments are issued on a stock exchange from where a large number of general public who are willing...
Dividend
A dividend is a distribution of a portion of company’s earnings, decided and managed by the company’s board of directors, and paid to the shareholders. Dividends are given on the shares. It is a token reward paid to the shareholders for their...
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Data Analysis and Decision Making

ISBN: 978-0538476126

4th edition

Authors: Christian Albright, Wayne Winston, Christopher Zappe

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