There is substantial cross-sectional variation in the number of financial analysts who follow a company. Suppose you hypothesize that a company's size (market cap) and financial risk (debt-to- equity ratio) influence the number of financial analysts who follow a company. You formulate the following regression model: (Analysts following)(i) = b(0) + b(1)*Size(i) + b(2)*(D/E)(i) + (i) Where: (Analysts following)(i) = the natural log of (1+n(i)), where n(i) is the number of analysts following company i. Size(i) = the natural log of the market capitalization of company (i) in millions of dollars (D/E)(i) = the debt-to-equity ratio for company (i) In the definition of Analyst following, 1 is added to the number of analysts following a company because some companies are not followed by any analysts, and the natural log of 0 is indeterminate. The following table gives the coefficient estimates of the above regression model for a randomly selected sample of 500 companies. The data are for the year 2002. Coefficient Estimates from Regressing Analyst Following on Size and Debt-to-Equity Ratio Coefficient Standard Error t-Statistic Intercept -0.2845 0.1080 -2.6343 Size(i) 0.3199 0.0152 21.0461 (D/E)(i) -0.1895 0.0620 -3.0565 n = 500 Source: First Call/Thomson Financial, Compustat.

I need to solve following two parts: A. Consider two companies, both of which have a debt-to-equity ratio of 0.75. The first company has a market capitalization of $100 million, and the second company has a market capitalization of $1 billion. Based on the above estimates, how many more analysts will follow the second company than the first company? B. Suppose the p-value reported for the estimated coefficient on (D/E)(i) is 0.00236. State the interpretation of 0.00236.