A Sample of 200 Monthly Observations Is Used to Run

question 62

Multiple Choice

A sample of 200 monthly observations is used to run a simple linear regression: Returns = β₀ + β₁ Leverage + ε.A 5% level of significance is used to study if leverage has a significant influence on returns.The value of the test statistic for the regression coefficient of Leverage is calculated as t₁₉₈ = -1.09,with an associated p-value of 0.2770.The correct decision is to __________________________________________________________.

• A) reject the null hypothesis and conclude that leverage significantly explains returns
• B) reject the null hypothesis and conclude that leverage does not significantly explain returns
• C) not reject the null hypothesis and conclude that leverage does not significantly explain returns
• D) not reject the null hypothesis and conclude that leverage significantly explains returns

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Definitions:

Integer 3

A specific instance of an integer data type, representing the numeric value 3.

Underlying Data Structure

The specific arrangement or organization of data in memory that supports the implementation and functionality of higher-level data types or structures.

Recursion

Recursion is a programming technique where a function calls itself in order to solve a problem by breaking it down into smaller, more manageable problems.

Stack

A data structure that follows the Last In, First Out (LIFO) principle, where the last element added is the first one to be removed.