Stock Prices and Earnings Per Share (EPS) Data Were Collected $= - 0.49 + 14.8$

question 28

Multiple Choice

Stock prices and earnings per share (EPS) data were collected for a sample of 15
Companies. Below are the regression results. Which of the following statement is true
About the correlation between stock price and EPS? The regression equation is
Stock Price $= - 0.49 + 14.8$ EPS

$\begin{array} { l r r r r } \text { Predictor } & \text { Coef } & \text { SE Coef } & \text { T } & \text { P } \\ \text { Constant } & - 0.486 & 4.032 & - 0.12 & 0.906 \\ \text { EPS } & 14.8129 & 0.9437 & 15.70 & 0.000 \end{array}$

$$S = 7.63235 \quad \mathrm { R } - \mathrm { Sq } = 95.0\%$$

• A) The correlation is negative.
• B) The correlation is not significantly different from zero.
• C) The correlation is positive and significantly different from zero.
• D) The correlation is positive but not significantly different from zero.
• E) Cannot be determined from the information given.

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Definitions:

Divisionalized Structures

Refers to an organizational framework where operations are segregated based on divisions, each focusing on a specific product line or market sector.

Geographically Based

Pertaining to, or determined by, geographic locations or areas, often used in contexts relating to distribution or organization by place.

Client-Based

A focus on understanding and meeting the specific needs of clients or customers.

Global Companies

Businesses that operate and compete in more than one country, facing unique challenges such as cultural differences and international regulations.