PristinDay Company Produces Handheld Calculators

question 227

Multiple Choice

PristinDay Company produces handheld calculators.The company controller wanted to calculate the fixed and variable costs associated with the maintenance cost incurred by the factory.Data for the past four months were collected as follows:

Coefficients shown by a regression program are as follows:



-Using the results of regression, calculate the fixed cost of maintenance.

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Definitions:

Security Price

The security price is the current market value at which a particular security (like stocks, bonds) can be bought or sold in the financial markets.

Abnormal Return

The difference between the actual return of a security and the expected return predicted by an equilibrium model.

Stock

A type of security that signifies ownership in a corporation and represents a claim on part of the corporation's assets and earnings.

Fundamental Analysts

Experts who evaluate investments by analyzing the fundamental financial conditions and performance of businesses and markets.