Revenue growth holds a vital position for businesses, regardless of their size. It stands as a critical barometer of a company's financial health and accomplishments, often laying the groundwork for forthcoming investments, expansions, and opportunities for growth. It can serve also as an indicator of a company's sales and marketing strategy effectiveness, as well as provide a basis for performance comparisons with its industry peers.

As a market analyst, you would like to explore the factors influencing a companys revenue generation and its growth potential. To embark on this inquiry, you have collected the following data from Capital IQ database for public companies belonging to the All Ordinaries Index. The data is stored in the Excel file Capital_IQ_data.xlsx.

Total Revenue, 1 Yr Growth % [FY 2022]: the percentage of revenue growth

over one year, from financial year 2021 to financial year 2022.

Total Debt/Equity %: refer to the debt-to-equity ratio (D/E ratio). It is calculated

by dividing a companys total debt by its total shareholder equity.

Inventory Turnover: is determined by diving the cost of goods sold by the average

inventory value over one year. The inventory turnover metric assesses the

effectiveness that a company manages its inventory. A relatively low inventory

turnover ratio could suggest sluggish sales or surplus inventory, whereas a higher

ratio indicates robust sales but might also point to insufficient inventory

management.

Return on Equity: is a financial ratio that measures the performance of a company

based on its shareholders' equity outstanding. It is determined by dividing net

income by shareholders' equity. Return on Equity (ROE) serves as an indicator of

a company's profitability and its effectiveness in generating earnings. A higher

ROE signifies more effective management in generating income and growth

through equity financing

% Stock Price Change [1 Year]: is measured as the percentage change in a

company stock price between financial year 2021 and financial year 2022. Utilising the provided data, your task is to conduct a regression analysis to identify the factors that may influence how a company grow its revenue. This analysis will help address the following questions.

1. Which variable(s) significantly determine the companys revenue growth?

2. Are the errors of the regression independent?

3. Is the regression model useful?