Exhibit 17

question 9

Multiple Choice

Exhibit 17.3.Consider the regression model, Humidity = β₀ + β₁Temperature + β₂Spring + β₃Summer + β₄Fall + β₅Rain + ε,
Where the dummy variables Spring,Summer,and Fall represent the qualitative variable Season (spring,summer,fall,winter) ,and the dummy variable Rain is defined as Rain = 1 if rainy day,Rain = 0 otherwise.
Refer to Exhibit 17.3.Assuming the same temperature and precipitation condition,what is the difference between the predicted humidity for summer and winter days?

• A)b₀ + b₁ + b₅
• B)b₀ + b₃ + b₅
• C)b₃
• D)b₀ + b₅

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Definitions:

Debt-equity Ratio

A measure of a company's financial leverage, calculated by dividing its total liabilities by stockholders' equity.

Price/earnings Ratio

A valuation metric for a stock, calculated as the market price per share divided by the earnings per share.

Share Repurchase

A corporate action in which a company buys back its own shares from the marketplace, which can increase the value of remaining shares.

Retention Ratio

The proportion of net income that is retained in the business rather than paid out to shareholders, indicating the company's reinvestment rate.