The following data gives the credibility score of certain firms based on current ratio, Debt/ Asset...

The following data gives the credibility score of certain firms based on current ratio, Debt/ Asset ratio, and
whether the firms go bankrupt or not

Firm No.	Current Ratio	Debt/Asset Ratio %	Credibility Score	Did Firm go Bankrupt earlier
1	3.4	60	0.78	N
2	3	76	0.791	Y
3	2.6	56	0.620	Y
4	2.5	68	0.757	Y
5	2.4	60	0.509	N
6	2.2	28	0.129	N
7	2.0	42	0.220	N
8	1.7	20	0.948	N
9	1.2	46	0.871	Y
10	1	28	0.391	Y

Fit a suitable regression equation predicting the credibility score.

Solve using Excel Data Analysis : Regression

Solutions

Expert Solution

sol:

code N as 0 anD Y as 1

from data analysis toolpak

SUMMARY OUTPUT

Regression Statistics
Multiple R	0.392337
R Square	0.153928
Adjusted R Square	-0.26911
Standard Error	0.315668
Observations	10

ANOVA
	df	SS	MS	F	Significance F
Regression	3	0.108774	0.036258	0.363865	0.781908
Residual	6	0.597879	0.099646
Total	9	0.706652

	Coefficients	Standard Error	t Stat	P-value	Lower 95%	Upper 95%
Intercept	0.335089	0.366704	0.913785	0.396064	-0.5622	1.232382
Current Ratio	0.036945	0.269687	0.136993	0.895518	-0.62296	0.696845
Debt/Asset Ratio %	0.002278	0.011391	0.199947	0.848127	-0.0256	0.03015
Did Firm go Bankrupt earlier	0.149991	0.292426	0.512921	0.626337	-0.56555	0.865531

regression eq is

credibilty score= 0.335088831+0.036945181*Current Ratio+0.002277606*Debt/Asset Ratio %+0.149991296*Did Firm go Bankrupt earlier

orchestra answered 1 year ago

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