Question
Some investors feel that since AT&T is such a large utility company, its earnings per share (EPS) should be related to the gross national product
Some investors feel that since AT&T is such a large utility company, its earnings per share (EPS) should be related to the gross national product (GNP). From the data in the accompanying table perform the following:
GNP | AT&T EPS | |
Year | Billions of Dollars | Dollars |
2004 | 520.1 | 0.82 |
2005 | 560.3 | 0.86 |
2006 | 590.5 | 0.88 |
2007 | 632.4 | 1.02 |
2008 | 684.9 | 1.08 |
2009 | 747.6 | 1.18 |
2010 | 789.7 | 1.22 |
a.) Estimate the least-square line; the standard error of each of the regression coefficients; the t-values; the coefficient of determination; the standard error of the regression; and the F value.
b.) Interpret all the information conveyed by the regression statistics above.
c.) Determine the point forecast of EPS when GNP= 800.
d.) What is the 95 percent confidence interval for your point forecast from part (c).
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