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The data in the file FinPortfolios.xls contain the company's portfolio performance data.
The data in the file FinPortfolios.xls contain the company's portfolio performance data. Each observation includes the average return of the portfolio, the portfolio manager's Age and Tenure (years in the company) as well their SAT score and whether they are MBA graduates (Yes:0, No:1). The total assets of each portfolio in thousands of dollars is also given.
The management of the financial company would like to determine to what extend all those characteristics explain the variation among the returns of individual portfolios. A regression using Age, Tenure, MBA, SAT and Assets as explanatory variables was suggested by the management. However the Business Analytics group suggests that using the logarithm of the assets [log(Assets)] is more appropriate and is used as a standard practice in industry.
i. Define the two regression models as they are described above and perform the corresponding regression analysis. Compare the results and justify why the model suggested by the Business Analytics group is the most appropriate.
ii. Interpret the coefficients in the regression model of the Business Analytics group
FinPortfolios excel in the link: https://www.dropbox.com/s/eeywihzs2ai7pvh/FinPortfolio.xls?dl=0
