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Fit the indicated multiple regressions model and show the Summary of Model
fit, ANOVA Table and the Parameter Estimates table. Interpret the
regression output from all these tables.
A. The Summary of Model fit, ANOVA Table and the Parameter Estimates table
have been shown below:
0=Intercept of the fit-line=0.0048. This represents the portion of Apple return that does
not vary with either of explanatory variables (Whole market return, IBM return)
1=Slope that represents variation of Apple return with respect to Whole market
return=1.32
2= Slope that represents variation of Apple return with respect to IBM return=0.23
We can see that P (1) < where =0.05 and 1 represents slope of variance of Apple
return with respect to the explanatory variable-Whole market return. Thus the hypothesis
that the Apple return does not vary with explanatory variable-Whole market return is
rejected since its value is less than 0.0001 (i.e. less than ).
Similarly, the p-value for IBM return comes out to be less than thus the hypothesis that
Apple return does not vary with explanatory variable-IBM return is rejected. The * in the
last column indicate this null hypothesis rejection.