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Question 1 You are investigating if firms selling differentiated products (i.e., different brand names} end up with higher returns on their equity capital. You obtained
Question 1 You are investigating if firms selling differentiated products (i.e., different brand names} end up with higher returns on their equity capital. You obtained the following regression results based on a sample of 48 firms: i;=1399+14900f+0246X2f950733j001atm 592(0456) a150n (0056) (4244) UlOl 22026 where Y = the rate of return on equity D = 1 for firms with product differentiation X2 = the market share X3 = the measure of the firm size X4 = the industry growth rate a) (5 marks) Interpret the results describing the coefficients and statistical significance. b) (2 marks) From your analysis, do firms that product differentiate earn a higher rate of return? Explain
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