Application of the Least Squares Method Results in Values of the Y-Intercept

question 50

Multiple Choice

Application of the least squares method results in values of the y-intercept and the slope that minimizes the sum of the squared deviations between the _____.

• A) observed values of the independent variable and the predicted values of the independent variable
• B) actual values of the independent variable and the predicted values of the dependent variable
• C) observed values of the dependent variable and the predicted values of the dependent variable
• D) None of the answers is correct.

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Definitions:

Accounting Recognition

This refers to the process of recording financial transactions in the financial statements according to accepted accounting principles.

Cash Flow

The total amount of money being transferred into and out of a business, especially affecting liquidity.

Direct Method

A way to present the cash flow statement where actual cash flows from operating activities are listed directly.

Net Cash Flows

The difference between cash inflows and outflows in a company over a specific period, indicating the net change in cash and cash equivalents.