What are the four key assumptions examined in specification analysis in the case of simple regression?

Q: Discuss the sensitivity of the model to changes in the value of the input variables

A: It is a technique that is used to get the estimates of independent variables by changing the…

Q: What are the steps in solving problems involving partitive proportions?

A: In partitive proportion, at first it is to be understood that there is a relationship between the…

Q: What is Gordon model?

A: Intrinsic value of a stock is based on the internal information of an organization. That is, market…

Q: What type of model is this showing?

A: Valuation models: There are three models that investors can employ to determine the intrinsic value…

Q: What assumptions underlie the EOQ model?

A: The model that helps in calculating the optimal amount of quantity needs to be purchase for…

Q: Explain constant prepayment assumptions?

A: Prepayment refers to the settlement of debt before its actual due date. The model which determines…

Q: From where has the concept DU pont Analysis comes?what’s the formula?

A: Ratio Analysis is the method of checking the company's operational efficiency, liquidity, and…

Q: How do your answers in parts (a) and (b) relate to the theory of constraints? Explain.

A: Introduction:- Constraints theory used to identifying the most important limiting factor that…

Q: In linear regression, compare independent and dependent variables.

A: Linear regression refers to a time series model in statistics that is used for predictive analysis.…

Q: sion equation y = a + bx, the letter b is best described as a (n):

A: In the standard regression equation, b represents the variable coefficient.

Q: What is modified breakeven analysis?

A: Break even analysis refers to the financial computation that weights the new business cost, product…

Q: What is meant by volatility clustering? Briefly describe two models that areused to describe data…

A: When the large changes in financial asset prices are bundled together that further leads to results…

Q: Explain the put call parity model. What are the advatages and disavantages of it?

A: Put-call parity characterizes the connection between calls, puts and the underlying assest price or…

Q: What assumptions are inherent in the EOQ model as presentedhere?

A: Economic order quantity (EOQ): Economic ordering quantity (EOQ) is the perfect order quantity a…

Q: a.Determine two-sigma control limits using the above data. (F

A: A c-chart helps to monitor the defects that occurred in the process. It helps companies to determine…

Q: Explain when to use the single-period model and when to use a multi-period model.

A: The difference between the two models is that the multi-period model may involve the stock leftovers…

Q: Identify one use of a multiple linear regression equation.

A: Regression Equation:   A regression equation is a form of algebraic expression consisting of…

Q: what are the major assumptions in making this estimate for REV?

A: Analyst estimates the worth of the real estate for the clients because now the investors have also…

Q: Describe the relationship between Simulation analysis, Scenario analysis and Sensitivity analysis –…

A: Sensitivity Analysis refers to an assessment of the impact of the changes in one variable on the NPV…

Q: Can you explain DCF model?

A: Introduction Discounted cash flows: DCF is abbreviated as discounted cash flows. The concept of…

Q: What is CVP analysis? Give three examples?

A: CVP Analysis:CVP analysis establishes the relation between cost, volume and profit of the company.…

Q: What are the CVP assumptions?

A:

Q: What is Hamada equation?

A: The Hamada Equation : The Hamada equation is a method used to analyse the cost of capital of firm.…

Q: what is single index model?

A: Single index model refers to the asset pricing model that can be used to measure the risk and return…

Q: Explain Black - Scholes Model, Binomial Model, Monte Carlo Simulation

A: Black-Scholes Model: It is a method that is used for pricing the options contract. It also derives…

Q: Discuss the main difference between the single-index model and the Markowitz optimization model.

A: Single Index Model- This article is concerning the quality rating model in political economy. For an…

Q: Define Top-down analysis

A: Introduction: Analyst is the person who gathers the data after they interpret and validate the data…

Q: How can we compute the true IRR, or RIC, as a function of the MARR?

A: Minimum Acceptable rate of return is the minimum rate which the management wishes to have from any…

Q: In your opinion what are the three most important areas to use when benchmarking?

A: Benchmarking is the technique to compare the business's product, practices, and services of the…

Q: Distinguish between the single-rate and the dual-rate methods.

A: Cost Allocation: The process of assigning the cost to the cost object is cost allocation. The cost…

Q: Define each of the following terms: e. Sensitivity analysis; scenario analysis; Monte Carlo…

A: Sensitivity Analysis is a tool used in financial modeling to analyze how the different values of a…

Q: Discuss the main and major difference between single index model and Markowitz optimization model.

A: The Single Index Model is an asset pricing model in which the returns on security can be interpreted…

Q: Explain Prepayment Assumptions?

A: Prepayment model : In simple words, A prepayment model is employed in banking to forecast the amount…

Q: Which of the following defines iterative calculation?

A: SPREADSHEET

Q: What are the main components of DU pont Analysis? Explain.

A: Introduction Dupont analysis Dupont system of analysis is an approach that can be used to analyse…

Q: Explain differential analysis

A: Differential Analysis involves understanding the purpose of different costs that may arise from…

Q: Fill in the blanks. a. In multiple linear regression analysis, the independent variables are called…

A: Fill in the blanks:   Predictor variable: Predictor variable in a regression in the independent…