While the Scaling Assumptions of Multiple Regression Require That Both

question 38

Multiple Choice

While the scaling assumptions of multiple regression require that both the independent and dependent variables be at least interval-scaled,we may use nominal independent variables by using:

• A)ratio-scaled variables.
• B)standardized beta coefficients.
• C)dummy variables.
• D)temporary variables.
• E)semi-ratio variables.

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Definitions:

Stripped Common Shares

Common shares from which certain rights have been removed, typically dividends or voting rights, often used in structured finance transactions.

Residual Dividend Approach

A method where the firm pays dividends from the residual or leftover equity after paying for all capital expenditures and working capital needs.

Debt/Equity Ratio

A financial ratio that measures the relative proportion of shareholders’ equity and debt used to finance a company’s assets.

Capital Investment

Funds invested in a firm or enterprise for the purpose of furthering its business objectives, including acquiring assets and launching new ventures.