Exhibit 18

question 22

Multiple Choice

Exhibit 18.3.The following table shows the annual revenues (in millions of dollars) of a pharmaceutical company over the period 1990-2011. Excel scatterplot shown above indicates that the annual revenues have an increasing trend.Therefore,linear,exponential,quadratic and cubic models were used to fit the trend,and the following relevant information became available after applying linear regression. Refer to Exhibit 18.3.What is the revenue forecast for 2013 found by the trend regression equation with the best fit?

• A)About 2 billion and 512 million dollars
• B)About 2 billion and 95 million dollars
• C)About 2 billion and 248 million dollars
• D)About 2 billion and 290 million dollars

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Definitions:

Commercial Paper

An unsecured, short-term debt instrument issued by corporations, typically used for financing payroll, accounts payable, and inventories.

Simple Interest

Interest that is computed solely on the initial sum invested or loaned, not taking into account any accumulated interest from previous periods.

Face Value

The nominal or dollar value printed on a security or financial instrument, representing its value upon maturity or redemption.

Treasury Bill

A short-term government security issued at a discount from the face value and yielding the face value upon maturity.