Cierra, Inc. is attempting to assess its degree of economic exposure in euros. In order to do so, it has applied regression analysis to determine whether the percentage change in its total cash flows is related to the percentage change in the euro. A ____ and statistically significant slope coefficient resulting from this analysis implies that the cash flows are ____ related to the percentage changes in the euro.

Question

Quizplus · Accepted Answer

A positive and statistically significant slope coefficient indicates that an increase in the value of the euro is associated with an increase in Cierra, Inc.'s total cash flows. This suggests that the company is economically exposed to euro as an increase in the euro can positively affect its financial performance. The word "positively" is used twice in the sentence, indicating a positive relationship between the two variables.