Which of the Following Is the Correct Interpretation for the Regression

question 12

Multiple Choice

Which of the following is the correct interpretation for the regression coefficient of Green?

• A) The regression coefficient indicates that the PE ratio of a firm that is green will, on average, be 2.09 points higher than a firm that is not green with the same profit growth rate and profit margin.
• B) The regression coefficient indicates that the PE ratio of a firm that is green will, on average, be 2.09 points lower than a firm that is not green with the same profit growth rate and profit margin.
• C) The regression coefficient indicates that the PE ratio of a firm that is green will, on average, be 2.09 points times higher than a firm that is not green.
• D) The regression coefficient indicates that the PE ratio of a firm that is green will, on average, be 2.09 points times lower than a firm that is not green.
• E) The regression coefficient is not significantly different from zero.