On the Basis of Regression Equation

question 53

Multiple Choice

On the basis of regression Equation
we can decompose the variability of the dollar value of the asset,Var(P) ,into two separate components.

• A)Cov(P,
• S) = b² *Var(
• P) + Var(
• B)Var(
• P) = b² * Var(
• S) + Var(e)
• C)Cov(P,
• S) = b² * Cov(S,
• P) + Cov(S,e)
• D)Var(
• P) = b² *Var(
• E)None of the above

---

Definitions:

Depreciable Non-current Asset

A long-term asset subject to depreciation, reflecting the asset's consumption, wear and tear, or obsolescence over its useful life.

Unrealised Gain

Profit that has been made on paper due to an increase in the value of an asset but has not yet been realized through a transaction.

Accumulated Depreciation

The total amount of depreciation expense that has been recorded against an asset over its useful life, reducing its book value on the balance sheet.