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Fair Share Company Value ($) Price (S) Air Products and Chemicals 80 98.63 Allied Waste Industries 17 11.02 America Mobile 83 61.39 AT&T 35 41.56

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Fair Share Company Value ($) Price (S) Air Products and Chemicals 80 98.63 Allied Waste Industries 17 11.02 America Mobile 83 61.39 AT&T 35 41.56 Bank of America 70 41.26 Barclays PLC 68 40.37 Citigroup 53 29.44 Costco Wholesale Corp. 75 69.76 Covidien, Ltd. 58 44.29 Darden Restaurants 52 27.71 Dun & Bradstreet 87 88.63 Equifax 42 36.36 Gannett Co. 38 39.00 Genuine Parts 48 46.30 Glaxo SmithKline PLC 57 50.39 Iron Mountain 33 37.02 ITT Corporation 83 66.04 Johnson & Johnson 80 66.70 Las Vegas Sands 98 103.05 Macrovision 23 18.33 Marriott International 39 34.18 Nalco Holding Company 29 24.18 National Interstate 25 33.10 Portugal Telecom 15 13.02 Qualcomm 48 39.35 Royal Dutch Shell Ltd. 87 84.20 SanDisk 60 33.17 Time Warner 42 27.60Question 6 The data Stock-"Stilt? show Monungstar's Fair Value estimate and the Share Price for 23 companies. Fair Value is an estimate of a company= 5 value per share that takes into account estimates of the company's growth= profitability, riskiness, and other factors over the next ve years ('Momingstar Stocks 51313, 213138 edition). a) Develop the estimated regression equation that could be used to estimate the share price given the fair value. b) At the 11.135 level of significance: is there a signicant relationship between the two variables? c} Use the estimated regression equation to predict the share price for a company that has a fair value of 350. d) Do you believe the estimated regression equation would provide a good prediction of the share price? Use 1"2 to support your

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