9 Collect data on corporate use of derivatives in risk management from various sources, e.g., Thomson ONE
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9 Collect data on corporate use of derivatives in risk management from various sources, e.g., Thomson ONE Banker and company annual reports. Implement a Tobit model by firstly estimating a probit model for the whole sample for corporate decisions as whether to use derivatives in risk management; and then secondly, if a decision is made for using derivatives, the amount of derivatives used in risk management by the sub-sample of derivatives user firms (using LIMDEP, GAUSS, RATS or other packages). The dependent variable is corporate use of derivatives. The independent variablesmayinclude firm size, financial leverage, the market-to-book ratio, interest coverage ratio, quick ratio, foreign exposure, and an industry dummy.
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