Children
Classified in Mathematics
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Assignment #3
Jedd Levin
 The Minitab output clearly shows that the H: b=0 is accepted since the pvalue is high. That is, the least square estimate 0.0109 for every unit of increment of the lagged return is not significantly different from a distribution with center about 0… or the alternative hypothesis b~= 0 is rejected. Basically, there is no statistical relationship between return at time t vs. The return at t1.

 According to this line, what is the estimated average height of the children of parents whose height is 60 inches?
Avg child height =
26.4558+.61152*parent ht. At 60, child ht=26.2558+.6152*60
=63.1678”
What is the estimated height of the children of parents whose height is 72inches?
26.2558+0.6152*72
=70.5502”
How do the average heights of the children compare to the heights of their parents ineach case?
For every inch increase in parent ht, children’s ht increases by 0.6152 inches. So, for parents who are 12 inches taller, one can expect their children to be 0.6152 *12= 7.3824” taller than the children’s ht whose parents were shorter.
 ANSWER
 (iii) Is a matter of pure mathematics. According to the article: “….Regression had nothing special to do with life or heredity. He knew that it was independent of the passage of time. Regression to the mean held even between brothers, he observed; exceptionally tall men tend to have brothers who are somewhat less tall. In fact, as Galton was able to show by a neat geometric argument, regression is a matter of pure mathematics, not an empirical force….”
 port= 0.3*msft + 0.7 * wmt
var(port) = 0.09*(6.02^2)+0.49*(4.07^2)+0.42*(.196)*(6.02* 4.07)
=3.261636+8.116801+2.016955248
=13.3954
Sd(port)=3.66