EXERCISE 6.8 Juan Martinez is an analyst at SDA, Inc., a leading mutual fund company. Juan has been asked to develop a regression model for use in predicting the market value of a firm. Table 6.41 shows data that Juan has gathered on 15 firms. The second column of the table shows the market value of each of the 15 firms. The third column shows the total assets of the each firm, and the fourth column shows the total sales of each firm, all for the previous year. The fifth column shows the number of employees at each firm. The data from Table 6.41 is also provided in the spreadsheet SDA.xls. (a) Construct a multiple linear regression model to predict the market value of a firm based on the data that Juan has gathered for the 15 firms. (b) Examine the regression output of your regression model. Is there evidence of multicollinearity in the model? How would you detect it? (c) Propose a simpler model by possibly deleting one or more independent variable(s) from your model. (d) Suppose a firm has assets of $1,800 million, sales of $3,500 million and has 31,000 employees. What is your prediction of the firm's market value using your model from part (c)? TABLE 6.41 The market value and related information for 15 firms for Exercise 6.8