The data set in the file ch18_MCSP_PotashCorp contains average quarterly share prices for PotashCorp and prices for
Question:
The data set in the file ch18_MCSP_PotashCorp contains average quarterly share prices for PotashCorp and prices for potash mineral. Investigate the relationship between these variables. (a) Some people think that if the share price of a mining company is high, that is because investors expect high mineral prices for the corresponding quarter. Can the potash price be estimated from the PotashCorp share price? The data includes a period when the price of potash mineral was exceptionally high. If you eliminate the quarters when the price of potash was over CDN$600/tonne, does that affect your analysis? (b) Other people think that if the price at which a mineral can be sold is high, then the share price of the companies producing that mineral will also be high. Is that the case for PotashCorp? That is, can PotashCorp’s share price be estimated from the potash mineral price? If you eliminate the quarters when the price of potash was ver CDN$600/tonne, does that affect your analysis? (c) Compare your answers to (a) and (b) including R-squared, P-value for slope, and the regression lines themselves.
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Business Statistics
ISBN: 9780133899122
3rd Canadian Edition
Authors: Norean D. Sharpe, Richard D. De Veaux, Paul F. Velleman, David Wright