Leila Corporation Used the Following Regression Model to Determine If

question 49

Multiple Choice

Leila Corporation used the following regression model to determine if the forecasts over the last ten years were biased:
S_t = a₀ + a₁Ft -1+ m_t,
Where S_t is the spot rate of the yen in year t and Ft _-1 is the forward rate of the yen in year t - 1. Regression results reveal coefficients of a₀ = 0 and a₁ = .30. Thus, Leila Corporation has reason to believe that its past forecasts have ____ the realized spot rate.

• A) overestimated
• B) underestimated
• C) correctly estimated
• D) none of the above

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Definitions:

IUPAC Name

The systematic method of naming chemical compounds as standardized by the International Union of Pure and Applied Chemistry.

IUPAC Name

is the systematic name given to a chemical substance based on the rules of the International Union of Pure and Applied Chemistry.

Bond Angle

The angle formed between two bonds that originate from the same atom.

Hybridizations

The concept in chemistry where atomic orbitals mix to form new hybrid orbitals suitable for the pairing of electrons to form chemical bonds in molecules.