Question
Diet Partners charges its clients a small management fee plus a percentage of gains when- ever portfolio returns are positive. cleo Smith believes that strong
Diet Partners charges its clients a small management fee plus a percentage of gains when- ever portfolio returns are positive. cleo Smith believes that strong incentives for portfolio managers produce superior returns for clients. in order to demonstrate this, Smith runs a regression with the diet Partners' portfolio return (in percent) as the dependent variable and its management fee (in percent) as the independent variable. The estimated regression for a 60-month period is return = 3.021+ 7.062 (Fee) (7.28) (14.95)
The calculated t-values are given in parentheses below the intercept and slope coefficients. The coefficient of determination for the regression model is 0.794.
please write a brief interpretation of the slope coefficient in this model?
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