If the Durbin-Watson Statistic,d,has Values Greater Than 2,this Indicates

question 75

Multiple Choice

If the Durbin-Watson statistic,d,has values greater than 2,this indicates

• A)a positive first-order autocorrelation
• B)a negative first-order autocorrelation
• C)no first-order autocorrelation at all
• D)None of these choices.

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Definitions:

Financial Leverage

The use of borrowed money (debt) to amplify the potential returns from an investment or project.

Bankruptcy Costs

Expenses and fees associated with the process of declaring bankruptcy, including legal fees, filing fees, and other related costs.

MM Theory

Modigliani-Miller Theorem; a financial theory stating that the market value of a company is independent of its capital structure and dividend policy under certain conditions.

MM Model

The Modigliani-Miller theorem, proposing that in an ideal market, the value of a firm is unaffected by its capital structure.