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Honda Motor Corp. measures the sensitivity of its exports to the yen exchange rate (relative to the U.S. dollar) using regression analysis. Specifically, the dependent
Honda Motor Corp. measures the sensitivity of its exports to the yen exchange rate (relative to the U.S. dollar) using regression analysis. Specifically, the dependent variable is a percentage change (from one period to the next) in Honda's export volume to the U.S, and the independent variables are the percentage change in the yen's value with respect to the dollar. What is the expected sign of the regression coefficient if Honda primarily exports to the United States? If Honda established plants in the United States, how might the regression coefficient on the exchange rate variable change? OA negative; decrease in magnitude OB. negative; increase in magnitude OC. positive; decrease in magnitude OD. positive, increase in magnitude
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