How are returns on common stocks in overseas markets related to returns in U.S.

Question

How are returns on common stocks in overseas markets related to returns in U.S. markets? Measure U.S. returns by the annual rate of return on the Standard & Poor's 500-Stock Index and overseas returns by the annual rate of return on the Morgan Stanley EAFE (Europe, Australasia, Far East) index. Both are recorded in percents. Regress the EAFE returns on the S&P; 500 returns for the 25 years 1975 to 2000. Here is part of the output for this regression. The regression equation is EAFE = 4.39 + 0.715 S&P.; (Round your answer for F to two decimal places and your answers for SS and MS to one decimal place.) for Complete the analysis of variance table by filling in the missing boxes. (Round your answer for s to two decimal places and your answer for r^2 to three decimal places.) What is s? What is r^2?

Explanation / Answer

s=(MSE)1/2 =(509.5652)1/2 =22.57

r2 =SSR/SST =0.109

Source DF SS MS F P regression 1 1429.1 1429.1 2.805 0.1075 Residual error 23 11720.0 509.5652 Total 24 13149.1

Related Questions

Navigate

• Browse (All)
• Browse H
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.