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Multiple choice questions from regression analysis

1. In a study of foreign holding in U.S. banks, year-end share of assets in U.S. banks held by foreigners (as a % of total assets) was related to:

X1 = Annual change, in billions of dollars, in foreign direct investment in the U.S. (excluding finance, insurance, and real estate)

X2 = Bank price-earnings ratio

X3 = Index of the exchange value of the dollar

The regression results from the sample data gave the following population parameter estimates:
a = -3.248 b1= .101 b2= -.244 b3=.057 R2=.93

What is the estimated year-end share of assets in U.S. bank subsidiaries held by foreigners for a particular year if the annual change in foreign direct investment in the U.S., (excluding finance, insurance, and real estate) was $50 Billion, the bank price-earnings ratio was 12, and the index of exchange value of the dollar was 175?

A. 3.456
B. 8.849
C. 12.097
D. 15.672
E. none of the above

2. A local bank analyzed the relationship between monthly salary and 3 independent variables: length of service (months), gender (0=female, 1=male) and job type (0=clerical, 1=technical). The following tables summarizes the regression results:

df SS MS F
Regression SS 3 1004346.771 334782.257 5.96
Unexplained SS 26 1461134.596 56197.48445

Coefficients Standard Error t Stat P-Value
Constant 784.92 322.25 2.44 0.02
Service 9.19 3.20 2.87 0.01
Gender 222.78 89.00 2.50 0.02
Job -28.21 89.61 -0.31 0.76

Based on the SS table and 0.05 significance level, the global null hypothesis test of the multiple regression model

A. Will be rejected and conclude that monthly salary is related to all the independent variables
B. Will be rejected and conclude that monthly salary is related to at least one of the independent variables
C. Will not be rejected
D. Will show a high multiple coefficient of determination
E. Cannot be ascertained given the above information

Solution Summary

Answers of multiple choice questions from regression analysis are given in the solution.

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