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What is the answer here? In a regression of perceived long-term investment value (LTIV) on size (S), book to market (B/M), and management quality (MQ),
What is the answer here?
In a regression of perceived long-term investment value (LTIV) on size (S), book to market (B/M), and management quality (MQ), the following coefficients (all significant) were estimated: LTIV=(.86)+(0.15)log(S)+(.11)log(B/M)+(.85)MQ (a) According to the results of the regression, what features contribute to a high perceived investment value? (5 marks) (b) Are the results consistent with market efficiency hypothesis? Explain. (5 marks) (c) Literature has reported two types of anomalies, small-firm effect and value-stock effect. Are the results consistent with the anomalies? Explain. (10 marks)Step by Step Solution
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