1. Foreign Exchange (FX) trading room in ACBC Investment Bank has collected data on the daily operational loss along with its potential contributing factors in the Q.1 tab. (a) [3pt] Construct a regression model Y = BX + e where Y is Loss and X is all the other variables (Errors, Cancels, and Trans/Trader). Report (i) which variable is statistically significant and (ii) the fitness of this regression model. (b) [2pt] Note that Trans/Trader means the average number of transactions made by one trader in this bank. Currently, the average number of transactions is 5400 and the average number of traders is 6. Using the regression model in (a), estimate the predicted change in Loss if they hire one additional trader. Day Loss ($) Errors Cancels Trans/Trader 1 13,458 65 505 1078.17 2 8,719 54 954 697.63 3 8,821 25 421 721.00 4 8,428 30 866 1088.67 5 9,476 42 521 814.00 6 8,465 65 254 569.09 7 9,212 68 480 829.14 8 10,147 143 296 924.50 9 14,020 15 1325 994.60 10 15,228 35 266 1306.75 11 8,791 31 232 907.83 12 8,215 27 996 873.67 13 10,083 24 368 998.60 14 8,258 19 416 531.22 15 9,925 55 606 544.80 16 10,428 53 429 553.30 17 9,681 55 300 528.70 18 8,281 95 193 439.58 19 13,200 27 382 946.00 20 9,770 17 183 788.83 21 23,334 11 404 1578.75 22 9,071 33 1814 1085.50 23 9,312 71 313 1160.67 24 9,243 31 3193 817.00 25 8,939 30 111 172.83 26 16,825 41 476 978.67 27 8,482 43 376 956.00 28 9,055 82 345 921.83 29 10,101 31 713 807.67 30 20,772 30 485 1522.67 31 9,762 29 430 880.17 32 25,339 41 880 1730.33 33 10,278 35 684 866.83 34 11,954 33 629 907.33 35 8,228 30 415 778.17 36 9,791 53 568 887.00 37 9,321 68 591 927.67 38 9,907 18 903 980.17 39 9.039 19 2324 995.33 F | | | | || || 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 56 57 58 59 60 61 62 63 64 65 66 67 68 69 70 71 72 73 74 75 76 77 78 79 180 88,997 8, 136 11,318 9,911 88,065 19,082 8,576 8,689 88,674 88,178 8,470 8,237 8,082 24,001 8,802 47,210 7,718 88,7266 9,500 8,321 88,089 11,400 88,093 8,319 31,383 88,331 88,238 8,236 25,250 8,163 8,000 21,498 8,208 7,601 8,000 12,356 10,880 8,913 88,572 8,972 8,307 30 37 27 33 47 29 46 32 34 28 24 18 55 27 32 35 22 13 17 23 19 16 41 29 43 15 15 26 11 19 24 26 31 25 12 9 30 72 12 49 28 536 1633 326 793 1024 716 697 765 740 948 472 497 295 879 231 449 709 378 479 468 444 1523 1857 590 422 721 499 637 927 1005 1126 818 387 1436 623 752 851 709 438 731 220 904.17 1038.00 921.50 985.67 1985.50 1416.00 974.50 895.50 878.67 878.67 738.33 853.83 923.33 1888.67 773.50 2167.50 237.20 774.83 873.33 755.50 726.33 886.17 865.17 845.17 1770.67 604.33 908.00 993.83 1666.67 770.00 214.17 1467.33 771.67 170.21 685.50 850.33 862.50 852.50 793.33 931.33 841.50 | | | | | | | | | | | | | | || | | | || | | | || || || | | | | | | 881 8,744 82 9,139 83 8,339 84 144,226 85 8,775 86 88, 195 887 8, 169 88 12,339 89 88, 100 90 7,721 91 8,602 92 9,241 93 10,913 94 8,745 95 88,325 96 88,452 97 8,167 98 9,369 99 10,593 100 15,792 101 8,833 102] 8, 133 103] 12, 164 104 8,000 105 9,095 106 9,084 42 86 388 65 28 107 28 109 1039 33 31 21 21 28 6 36 26 58 44 22 64 57 28 171 33 24 960 1423 779 646 393 1023 298 1370 664 512 681 539 939 1075 374 493 1061 1096 351 491 787 597 419 297 662 2510 948.17 871.50 786.67 1800.67 806.33 896.00 905.83 976.67 576.00 898.00 927.50 891.50 901.17 871.33 700.00 936.33 1038.50 1069.33 964.83 880.67 1059.50 927.33 1025.83 851.67 898.00 1047.50 1. Foreign Exchange (FX) trading room in ACBC Investment Bank has collected data on the daily operational loss along with its potential contributing factors in the Q.1 tab. (a) [3pt] Construct a regression model Y = BX + e where Y is Loss and X is all the other variables (Errors, Cancels, and Trans/Trader). Report (i) which variable is statistically significant and (ii) the fitness of this regression model. (b) [2pt] Note that Trans/Trader means the average number of transactions made by one trader in this bank. Currently, the average number of transactions is 5400 and the average number of traders is 6. Using the regression model in (a), estimate the predicted change in Loss if they hire one additional trader. Day Loss ($) Errors Cancels Trans/Trader 1 13,458 65 505 1078.17 2 8,719 54 954 697.63 3 8,821 25 421 721.00 4 8,428 30 866 1088.67 5 9,476 42 521 814.00 6 8,465 65 254 569.09 7 9,212 68 480 829.14 8 10,147 143 296 924.50 9 14,020 15 1325 994.60 10 15,228 35 266 1306.75 11 8,791 31 232 907.83 12 8,215 27 996 873.67 13 10,083 24 368 998.60 14 8,258 19 416 531.22 15 9,925 55 606 544.80 16 10,428 53 429 553.30 17 9,681 55 300 528.70 18 8,281 95 193 439.58 19 13,200 27 382 946.00 20 9,770 17 183 788.83 21 23,334 11 404 1578.75 22 9,071 33 1814 1085.50 23 9,312 71 313 1160.67 24 9,243 31 3193 817.00 25 8,939 30 111 172.83 26 16,825 41 476 978.67 27 8,482 43 376 956.00 28 9,055 82 345 921.83 29 10,101 31 713 807.67 30 20,772 30 485 1522.67 31 9,762 29 430 880.17 32 25,339 41 880 1730.33 33 10,278 35 684 866.83 34 11,954 33 629 907.33 35 8,228 30 415 778.17 36 9,791 53 568 887.00 37 9,321 68 591 927.67 38 9,907 18 903 980.17 39 9.039 19 2324 995.33 F | | | | || || 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 56 57 58 59 60 61 62 63 64 65 66 67 68 69 70 71 72 73 74 75 76 77 78 79 180 88,997 8, 136 11,318 9,911 88,065 19,082 8,576 8,689 88,674 88,178 8,470 8,237 8,082 24,001 8,802 47,210 7,718 88,7266 9,500 8,321 88,089 11,400 88,093 8,319 31,383 88,331 88,238 8,236 25,250 8,163 8,000 21,498 8,208 7,601 8,000 12,356 10,880 8,913 88,572 8,972 8,307 30 37 27 33 47 29 46 32 34 28 24 18 55 27 32 35 22 13 17 23 19 16 41 29 43 15 15 26 11 19 24 26 31 25 12 9 30 72 12 49 28 536 1633 326 793 1024 716 697 765 740 948 472 497 295 879 231 449 709 378 479 468 444 1523 1857 590 422 721 499 637 927 1005 1126 818 387 1436 623 752 851 709 438 731 220 904.17 1038.00 921.50 985.67 1985.50 1416.00 974.50 895.50 878.67 878.67 738.33 853.83 923.33 1888.67 773.50 2167.50 237.20 774.83 873.33 755.50 726.33 886.17 865.17 845.17 1770.67 604.33 908.00 993.83 1666.67 770.00 214.17 1467.33 771.67 170.21 685.50 850.33 862.50 852.50 793.33 931.33 841.50 | | | | | | | | | | | | | | || | | | || | | | || || || | | | | | | 881 8,744 82 9,139 83 8,339 84 144,226 85 8,775 86 88, 195 887 8, 169 88 12,339 89 88, 100 90 7,721 91 8,602 92 9,241 93 10,913 94 8,745 95 88,325 96 88,452 97 8,167 98 9,369 99 10,593 100 15,792 101 8,833 102] 8, 133 103] 12, 164 104 8,000 105 9,095 106 9,084 42 86 388 65 28 107 28 109 1039 33 31 21 21 28 6 36 26 58 44 22 64 57 28 171 33 24 960 1423 779 646 393 1023 298 1370 664 512 681 539 939 1075 374 493 1061 1096 351 491 787 597 419 297 662 2510 948.17 871.50 786.67 1800.67 806.33 896.00 905.83 976.67 576.00 898.00 927.50 891.50 901.17 871.33 700.00 936.33 1038.50 1069.33 964.83 880.67 1059.50 927.33 1025.83 851.67 898.00 1047.50