The following regression analysis was conducted for the inflation rate information and exchange rate of the British pound:
$e _ { B P } = a _ { 0 } + a _ { 1 } \left( \frac { \left( 1 + I _ { U S } \right) } { \left( 1 + I _ { B } \right) } - 1 \right) + \mu$
Regression results indicate that a₀= 0 and a₁ = 0.4. Therefore:

Question

The following regression analysis was conducted for the inflation rate information and exchange rate of the British pound:

e _ { B P } = a _ { 0 } + a _ { 1 } \left( \frac { \left( 1 + I _ { U S } \right) } { \left( 1 + I _ { B } \right) } - 1 \right) + \mu

Regression results indicate that a₀= 0 and a₁ = 0.4. Therefore:

Quizplus · Accepted Answer

The Answer of The following regression analysis was conducted for the inflation rate information and exchange rate of the British pound: $e _ { B P } = a _ { 0 } + a _ { 1 } \left( \frac { \left( 1 + I _ { U S } \right) } { \left( 1 + I _ { B } \right) } - 1 \right) + \mu$ Regression results indicate that a₀= 0 and a₁ = 0.4. Therefore:

The Following Regression Analysis Was Conducted for the Inflation Rate eBP=a0+a1((1+IUS)(1+IB)−1)+μe _ { B P } = a _ { 0 } + a _ { 1 } \left( \frac { \left( 1 + I _ { U S } \right) } { \left( 1 + I _ { B } \right) } - 1 \right) + \mueBP​=a0​+a1​((1+IB​)(1+IUS​)​−1)+μ

The Following Regression Analysis Was Conducted for the Inflation Rate $e _ { B P } = a _ { 0 } + a _ { 1 } \left( \frac { \left( 1 + I _ { U S } \right) } { \left( 1 + I _ { B } \right) } - 1 \right) + \mu$