Exhibit 16-3
Below You Are Given a Partial Computer Output $\beta$

question 49

Multiple Choice

Exhibit 16-3
Below you are given a partial computer output based on a sample of 25 observations.
-Refer to Exhibit 16-3. We want to test whether the parameter $\beta$ ₂ is significant. The test statistic equals

• A)4
• B)5
• C)3
• D)-3

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Definitions:

Cash Dividend

A payment made by a company out of its earnings to shareholders in the form of cash.

Complete Portfolio

An investment strategy that includes a diverse mix of assets to optimize risk and return.

Capital Allocation Line

A line in investment graph that shows the risk-reward profiles of various portfolios, combining a risk-free asset with a risky portfolio to maximize returns.

Risk-free Asset

An investment with a guaranteed return and no chance of default, such as government bonds.