An investment analyst wants to examine the relationship between a mutual fund's return,its turnover rate,and its expense ratio.She randomly selects 10 mutual funds and estimates: Return = β₀ + β₁Turnover + β₂Expense + ε,where Return is the average five-year return (in %),Turnover is the annual holdings turnover (in %),Expense is the annual expense ratio (in %),and ε is the random error component.A portion of the regression results is shown in the accompanying table. a.At the 10% significance level,are the explanatory variables jointly significant in explaining Return? Explain.
b.At the 10% significance level,is each explanatory variable individually significant in explaining Return? Explain.

Question

An investment analyst wants to examine the relationship between a mutual fund's return,its turnover rate,and its expense ratio.She randomly selects 10 mutual funds and estimates: Return = β₀ + β₁Turnover + β₂Expense + ε,where Return is the average five-year return (in %),Turnover is the annual holdings turnover (in %),Expense is the annual expense ratio (in %),and ε is the random error component.A portion of the regression results is shown in the accompanying table.

a.At the 10% significance level,are the explanatory variables jointly significant in explaining Return? Explain.
b.At the 10% significance level,is each explanatory variable individually significant in explaining Return? Explain.

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The Answer of An investment analyst wants to examine the relationship between a mutual fund's return,its turnover rate,and its expense ratio.She randomly selects 10 mutual funds and estimates: Return = β₀ + β₁Turnover + β₂Expense + ε,where Return is the average five-year return (in %),Turnover is the annual holdings turnover (in %),Expense is the annual expense ratio (in %),and ε is the random error component.A portion of the regression results is shown in the accompanying table. a.At the 10% significance level,are the explanatory variables jointly significant in explaining Return? Explain. b.At the 10% significance level,is each explanatory variable individually significant in explaining Return? Explain.

An Investment Analyst Wants to Examine the Relationship Between a Mutual