Statistics - Regression Projects

The regression for this data set has a low R-squared. Does that mean that the regression is useless? Can

  1. The regression for this data set has a low R-squared. Does that mean that the regression is useless? Can you think of a situation in which a useless regression has high R-squared?
  2. Does the regression in the worksheet violate (i) linear relationship, and (ii) equal variance assumption?
  3. Peter is a 35 year old NUS Graduate who has managed a growth and income fund for 5 years. He does not have an MBA and list his hobbies as chess. The military and his family. Assuming that the average composite SAT score for NUS graduates is 1042. Estimate the excess return (RET) of the funds that Peter currently manage.
  4. Mark is a 32 year old Princeton graduate (average composite SAT score of 1355) with an MBA from Harvard. She has managed a growth and income fund for two years, and lists attendance at cocktail parties his main hobby. Estimate the excess return (RET) of the funds that Mark currently manage.
  5. Does the regression provide strong evidence that fund managers with MBAs perform worse than managers without MBAs? What is being held constant in this comparison? Discuss.
  6. Streamline the regression given and eliminate all variables that are not significant at the 15 percent level. Write down the new equation and check whether the specification satisfies the assumptions of linearity and homoscedasticity (equal variance). Compare the coefficient of AGE in the new and the old regressions. What can explain the sign (direction) of the change in this estimator? Explain.
Price: $11.54
Solution: The downloadable solution consists of 5 pages, 654 words and 2 charts.
Deliverable: Word Document



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