Instruction 13 $\text { OUTPUT }$ Note: Adj R Square = Adjusted R Square; Std

question 246

Short Answer

Instruction 13.13
A financial analyst wanted to examine the relationship between salary (in $1,000) and four variables: age (X₁ = Age), experience in the field (X₂ = Exper), number of degrees (X₃ = Degrees) and number of previous jobs in the field (X₄ = Prevjobs). He took a sample of 20 employees and obtained the following Microsoft Excel output:
$\text { OUTPUT }$
$\begin{array}{ll}\text { SUMMARY}\\\text { Regression }&\text { Statistics}\\\text { Multiple R } & 0.992 \\\text { R Square } & 0.984 \\\text { Adj. R Square } & 0.979 \\\text { Std. Error } & 2.26743 \\\text { Observations } & 20\end{array}$

$\begin{array}{l}\text { ANOVA }\\\begin{array}{llllll} & \text { df } & \text { SS } & \text { MS } & F & \text { Signif F } \\\text { Regression } & 4 & 4609.83164 & 1152.45791 & 224.160 & 0.0001 \\\text { Residual } & 15 & 77.11836 & 5.14122 & & \\\text { Total } & 19 & 4686.95000 & & &\end{array}\end{array}$

$\begin{array}{lllll} & \text { Coeff } & \text { Std Error } & t \text { Stat } & p \text { value } \\\text { Intercept } & -9.611198 & 2.77988638 & -3.457 & 0.0035 \\\text { Age } & 1.327695 & 0.11491930 & 11.553 & 0.0001 \\\text { Exper } & -0.106705 & 0.14265559 & -0.748 & 0.4660 \\\text { Degrees } & 7.311332 & 0.80324187 & 9.102 & 0.0001 \\\text { Prevjobs } & -0.504168 & 0.44771573 & -1.126 & 0.2778\end{array}$

Note: Adj. R Square = Adjusted R Square; Std. Error = Standard Error
-Referring to Instruction 13.13,the net regression coefficient of X₂ is ___________.

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Definitions:

Callable Bonds

Bonds that can be redeemed by the issuer prior to their maturity date, usually at a premium above the face value.

Financing Activities

Transactions involving changes in equity and long-term liabilities on the balance sheet, reflective of how a company raises capital and repays its investors.

Amortization

Amortization is the process of gradually writing off the initial cost of an intangible asset over its useful life, reflecting its consumption or expiration.

Straight-Line Amortization

An alternative method of amortizing bond discounts and premiums that allocates an equal dollar amount to each interest period. It is only permitted by GAAP under specific circumstances.