A financial institution specializing in venture capital is interested in pre- dicting the success of business...
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A financial institution specializing in venture capital is interested in pre- dicting the success of business operations that the institution helps to finance. Success is defined by the institution as return on its investment, as a percentage, after 3 years of operation. The explanatory variables used are Investment (in thousands of dollars), Early investment (in thousands of dollars), and two dummy variables denoting the category of business. The values of these variables are (0, 0) for high-technology industry, (0, 1) for biotechnology companies, and (1, 0) for aerospace firms. Following is part of the computer output for this analysis. Inter- pret the output, and give a complete analysis of the results of this study based on the provided information. The regression equation is Return = 6.16 + 0.617 INVEST + 0.151 EARLY + 11.1 LUM1 + 4.15 DUM2 Predictor Coef Stdev Constant 6.162 1.642 INVEST 0.6168 0.1581 EARLY 0.1509 0.1465 DUM1 11.051 1.355 DUM2 4.150 1.315 s = 2.148 R-sq = 91.6% R-sq (adj) 89.4% %3D Analysis of Variance SOURCE DF SS Regression 4 755.99 Error 15 69.21 Total 19 825.20 A financial institution specializing in venture capital is interested in pre- dicting the success of business operations that the institution helps to finance. Success is defined by the institution as return on its investment, as a percentage, after 3 years of operation. The explanatory variables used are Investment (in thousands of dollars), Early investment (in thousands of dollars), and two dummy variables denoting the category of business. The values of these variables are (0, 0) for high-technology industry, (0, 1) for biotechnology companies, and (1, 0) for aerospace firms. Following is part of the computer output for this analysis. Inter- pret the output, and give a complete analysis of the results of this study based on the provided information. A financial institution specializing in venture capital is interested in pre- dicting the success of business operations that the institution helps to finance. Success is defined by the institution as return on its investment, as a percentage, after 3 years of operation. The explanatory variables used are Investment (in thousands of dollars), Early investment (in thousands of dollars), and two dummy variables denoting the category of business. The values of these variables are (0, 0) for high-technology industry, (0, 1) for biotechnology companies, and (1, 0) for aerospace firms. Following is part of the computer output for this analysis. Inter- pret the output, and give a complete analysis of the results of this study based on the provided information. The regression equation is Return = 6.16 + 0.617 INVEST + 0.151 EARLY + 11.1 LUM1 + 4.15 DUM2 Predictor Coef Stdev Constant 6.162 1.642 INVEST 0.6168 0.1581 EARLY 0.1509 0.1465 DUM1 11.051 1.355 DUM2 4.150 1.315 s = 2.148 R-sq = 91.6% R-sq (adj) 89.4% %3D Analysis of Variance SOURCE DF SS Regression 4 755.99 Error 15 69.21 Total 19 825.20 The regression equation is Return = 6.16 + 0.617 INVEST + 0.151 EARLY + 11.1 LUM1 + 4.15 DUM2 Predictor Coef Stdev Constant 6.162 1.642 INVEST 0.6168 0.1581 EARLY 0.1509 0.1465 DUM1 11.051 1.355 DUM2 4.150 1.315 s = 2.148 R-sq = 91.6% R-sq (adj) 89.4% %3D Analysis of Variance SOURCE DF SS Regression 4 755.99 Error 15 69.21 Total 19 825.20
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Answer Return 616 0617 Invest 0151 Early 111 Dumi 415 Dum2 Fit of the model is checked by the v... View the full answer
Related Book For
Business Statistics
ISBN: 978-0321925831
3rd edition
Authors: Norean Sharpe, Richard Veaux, Paul Velleman
Posted Date:
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