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Use the dataset ORG_QEarnings and perform the following regression: QE QEt-4 = a + ß* (QEt-1- QEt-5) + Et where QE denotes quarterly earnings of Origin Energy Ltd in quarter t. a is the constant term (i.e., the intercept) and & is the error term. The regression should be performed using 20 quarters of earnings data. Report your regression estimates in the table below:

Use the dataset ORG_QEarnings and perform the following regression: QE QEt-4 = a + ß* (QEt-1- QEt-5) + Et where QE denotes quarterly earnings of Origin Energy Ltd in quarter t. a is the constant term (i.e., the intercept) and & is the error term. The regression should be performed using 20 quarters of earnings data. Report your regression estimates in the table below:

Algebra & Trigonometry with Analytic Geometry
Algebra & Trigonometry with Analytic Geometry
13th Edition
ISBN:9781133382119
Author:Swokowski
Publisher:Swokowski
Chapter10: Sequences, Series, And Probability
Section10.2: Arithmetic Sequences
Problem 52E
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Company Legal Name ASX Code ORIGIN ENERGY LTD ORG ORIGIN ENERGY LTD ORG ORG ORG ORG ORIGIN ENERGY LTD ORIGIN ENERGY LTD ORIGIN ENERGY LTD ORIGIN ENERGY LTD ORG ORIGIN ENERGY LTD ORG ORIGIN ENERGY LTD ORG ORIGIN ENERGY LTD ORG ORIGIN ENERGY LTD ORIGIN ENERGY LTD ORIGIN ENERGY LTD ORG ORIGIN ENERGY LTD ORG ORIGIN ENERGY LTD ORG ORIGIN ENERGY LTD ORG ORIGIN ENERGY LTD ORG ORIGIN ENERGY LTD ORG ORIGIN ENERGY LTD ORG ORIGIN ENERGY LTD ORG ORIGIN ENERGY LTD ORG ORG QEarnings 1 Date 2 2019/4/1 3 2019/4/2 4 2019/4/3 5 2019/4/4 6 2019/4/5 7 2019/4/8 8 2019/4/9 9 2019/4/10 10 2019/4/11 11 2019/4/12 12 2019/4/15 13 2019/4/16 14 2019/4/17 15 2019/4/18 16 2019/4/23 17 2019/4/24 18 2019/4/26 19 2019/4/29 20 2019/4/30 21 2019/5/1 22 2019/5/2 2019/5/3 23 24 2019/5/6 25 2019/5/7 26 2019/5/8 27 2019/5/9 28 2019/5/10 29 2019/5/13 30 2019/5/14 31 2019/5/15 32 2019/5/16 33 2019/5/17 34 2019/5/20 2019/5/21 35 36 2019/5/22 37 2019/5/23 38 2019/5/24 39 40 2019/5/27 2019/5/28 41 2019/5/29 42 2019/5/30 1 Date 23 45 ORG ORG 5 2 2019/4/1 2019/4/2 4 2019/4/3 2019/4/4 6 2019/4/5 7 2019/4/8 8 2019/4/9 9 2019/4/10 10 2019/4/11 11 2019/4/12 12 2019/4/15 13 2019/4/16 14 2019/4/17 15 2019/4/18 16 2019/4/23 17 2019/4/24 18 2019/4/26 19 2019/4/29 20 2019/4/30 21 2019/5/1 22 2019/5/2 23 2019/5/3 24 2019/5/6 25 2019/5/7 26 2019/5/8 27 2019/5/9 28 2019/5/10 29 2019/5/13 30 2019/5/14 31 2019/5/15 32 2019/5/16 33 2019/5/17 34 2019/5/20 35 2019/5/21 36 2019/5/22 37 2019/5/23 38 2019/5/24 39 40 2019/5/27 2019/5/28 2019/5/29 41 43 44 42 2019/5/30 2019/5/31 2019/6/3 Data Date 2014/6/30 2014Q2 2014/9/30 201403 2014/12/31 201404 2015/3/31 201501 2015/6/30 201502 2015/9/30 201503 2015/12/31 201504 Data Calendar Year_Quarter 2016/3/31 2016Q1 2016/6/30 2016Q2 2016/9/30 2016Q3 43 2019/5/31 ASX Daily Returns (%) 44 2019/6/3 45 2019/6/4 0.5873 0.4086 0.6824 -0.8305 46 2019/6/5 47 2019/6/6 48 2019/6/7 49 2019/6/11 -0.8263 0.6487 0.0064 50 2019/6/12 2019/6/13 51 52 2019/6/14 0.0273 -0.3985 0.8486 53 2019/6/17 2019/6/18 0.0016 54 0.4159 55 2019/6/19 -0.3345 56 2019/6/20 2019/6/21 58 2019/6/24 0.0543 57 0.9521 0.9922 59 2019/6/25 0.0548 60 2019/6/26 -0.4087 61 2019/6/27 -0.5346 62 2019/6/28 0.7968 63 2019/7/1 -0.5882 64 2019/7/2 -0.0410 65 2019/7/3 -0.8223 66 0.1910 67 -0.4225 68 2016/12/31 201604 2017/3/31 2017Q1 2017/6/30 2017Q2 2017/9/30 201703 2017/12/31 201704 2018/3/31 2018Q1 2018/6/30 201802 2018/9/30 2018Q3 2018/12/31 201804 2019/3/31 2019Q1 2019/7/4 2019/7/5 2019/7/8 0.4179 69 2019/7/9 0.2478 70 2019/7/10 -0.2107 71 2019/7/11 -0.9162 72 2019/7/12 0.7099 73 2019/7/15 0.6938 74 2019/7/16 0.5926 75 2019/7/17 1.7407 76 2019/7/18 0.3706 77 2019/7/19 0.1631 78 2019/7/22 -0.2903 79 2019/7/23 -0.5515 80 2019/7/24 -0.0635 81 2019/7/25 0.5099 82 2019/7/26 -0.6908 83 2019/7/29 -0.7438 84 2019/7/30 0.0751 -1.1943 0.1883 83 0.4122 0.3853 84 0.9541 85 1.5891 86 -0.0397 -0.0199 87 0.1773 88 -0.3525 89 0.5987 1.1887 90 0.5911 91 -0.5473 0.2195 92 -0.1110 93 -0.2628 0.3885 94 -0.7125 95 0.4427 0.0767 96 0.4855 97 0.4861 0.4957 98 -1.1716 -0.0974 0.3616 100 0.3931 101 -0.2918 -0.6496 -0.1804 103 0.4864 IORD Close 7.15 45 7.14 46 7.18 47 7.11 48 QE(t) 104.0 -35.5 -12.5 0.0 0.0 -141.0 -141.0 -167.5 -167.5 -689.0 -748.0 OO 2019/7/29 2019/7/30 2019/7/31 2019/8/1 2019/8/2 2019/8/5 2019/8/6 2019/8/7 2019/8/8 2019/8/9 2019/8/12 2019/8/13 2019/8/14 2019/8/15 2019/8/16 2019/8/19 99 2019/8/20 2019/8/21 2019/8/22 102 2019/8/23 2019/8/26 104 2019/8/27 -0.3626 0.7700 105 2019/8/28 -0.1358 106 2019/8/29 0.4992 0.7748 107 2019/8/30 0.6094 -0.3608 0.4769 0.2828 0.0 0.0 -68.0 -68.0 208.0 208.0 398.0 398.0 207.5 QE(t-1) 2019/7/10 2019/7/11 2019/7/12 2019/7/15 2019/7/16 2019/7/17 2019/7/18 2019/7/19 2019/7/22 2019/7/23 2019/7/24 2019/7/25 2019/7/26 104.0 104.0 -35.5 -12.5 2019/6/4 2019/6/5 2019/6/6 2019/6/7 7.1 49 2019/6/11 7.25 50 2019/6/12 7.31 51 2019/6/13 7.23 52 2019/6/14 7.2 53 2019/6/17 7.25 54 2019/6/18 7.29 55 2019/6/19 7.29 56 2019/6/20 7.3 57 2019/6/21 7.32 58 2019/6/24 7.57 59 2019/6/25 7.57 60 2019/6/26 7.48 61 2019/6/27 7.45 62 2019/6/28 7.37 63 2019/7/1 7.66 64 2019/7/2 7.66 65 2019/7/3 7.52 66 2019/7/4 7.41 67 2019/7/5 7.52 68 2019/7/8 7.4 69 2019/7/9 7.44 70 7.51 7.45 71 7.26 72 7.44 73 7.74 74 7.89 75 7.97 76 7.85 77 7.86 78 7.72 79 7.51 80 7.59 81 7.69 82 7.5 83 7.34 84 7.18 85 7.1 2019/7/29 2019/7/30 2019/7/31 OO 0.0 0.0 QE(t-4) QE(t-5) -73.0 161.0 161.0 104.0 104.0 -35.5 -12.5 -141.0 -141.0 -167.5 -167.5 -141.0 -689.0 -141.0 -141.0 -748.0 -167.5 -141.0 0.0 -167.5 -167.5 0.0 -689.0 -167.5 -68.0 -748.0 -68.0 -689.0 -748.0 0.0 208.0 208.0 0.0 398.0 398.0 0.0 0.0 000 -73.0 -73.0 161.0 161.0 104.0 104.0 -35.5 -12.5 0.0 0.0 -68.0 -68.0 208.0 -68.0 -68.0 0.0 0.0 0.4769 0.2828 -0.4748 -0.3479 -0.2990 -1.8955 -2.4427 0.6391 0.7455 0.2482 0.0896 -0.3308 0.4171 -2.8472 -0.0406 966 1.1999 -0.9427 0.2853 0.3276 -1.2724 0.4829 0.4543 0.1046 1.4875 7.11 7.08 7.06 7.08 7.19 7.15 6.95 7.02 6.91 6.91 7.04 7.26 7.35 7.34 7.32 7.34 7.46 7.31 7.39 7.41 7.43 7.47 7.65 7.58 7.42 7.45 7.52 7.53 7.43 7.42 7.43 7.36 7.51 7.58 7.69 7.75 7.76 7.85 7.86 7.86 7.94
Transcribed Image Text:Company Legal Name ASX Code ORIGIN ENERGY LTD ORG ORIGIN ENERGY LTD ORG ORG ORG ORG ORIGIN ENERGY LTD ORIGIN ENERGY LTD ORIGIN ENERGY LTD ORIGIN ENERGY LTD ORG ORIGIN ENERGY LTD ORG ORIGIN ENERGY LTD ORG ORIGIN ENERGY LTD ORG ORIGIN ENERGY LTD ORIGIN ENERGY LTD ORIGIN ENERGY LTD ORG ORIGIN ENERGY LTD ORG ORIGIN ENERGY LTD ORG ORIGIN ENERGY LTD ORG ORIGIN ENERGY LTD ORG ORIGIN ENERGY LTD ORG ORIGIN ENERGY LTD ORG ORIGIN ENERGY LTD ORG ORIGIN ENERGY LTD ORG ORG QEarnings 1 Date 2 2019/4/1 3 2019/4/2 4 2019/4/3 5 2019/4/4 6 2019/4/5 7 2019/4/8 8 2019/4/9 9 2019/4/10 10 2019/4/11 11 2019/4/12 12 2019/4/15 13 2019/4/16 14 2019/4/17 15 2019/4/18 16 2019/4/23 17 2019/4/24 18 2019/4/26 19 2019/4/29 20 2019/4/30 21 2019/5/1 22 2019/5/2 2019/5/3 23 24 2019/5/6 25 2019/5/7 26 2019/5/8 27 2019/5/9 28 2019/5/10 29 2019/5/13 30 2019/5/14 31 2019/5/15 32 2019/5/16 33 2019/5/17 34 2019/5/20 2019/5/21 35 36 2019/5/22 37 2019/5/23 38 2019/5/24 39 40 2019/5/27 2019/5/28 41 2019/5/29 42 2019/5/30 1 Date 23 45 ORG ORG 5 2 2019/4/1 2019/4/2 4 2019/4/3 2019/4/4 6 2019/4/5 7 2019/4/8 8 2019/4/9 9 2019/4/10 10 2019/4/11 11 2019/4/12 12 2019/4/15 13 2019/4/16 14 2019/4/17 15 2019/4/18 16 2019/4/23 17 2019/4/24 18 2019/4/26 19 2019/4/29 20 2019/4/30 21 2019/5/1 22 2019/5/2 23 2019/5/3 24 2019/5/6 25 2019/5/7 26 2019/5/8 27 2019/5/9 28 2019/5/10 29 2019/5/13 30 2019/5/14 31 2019/5/15 32 2019/5/16 33 2019/5/17 34 2019/5/20 35 2019/5/21 36 2019/5/22 37 2019/5/23 38 2019/5/24 39 40 2019/5/27 2019/5/28 2019/5/29 41 43 44 42 2019/5/30 2019/5/31 2019/6/3 Data Date 2014/6/30 2014Q2 2014/9/30 201403 2014/12/31 201404 2015/3/31 201501 2015/6/30 201502 2015/9/30 201503 2015/12/31 201504 Data Calendar Year_Quarter 2016/3/31 2016Q1 2016/6/30 2016Q2 2016/9/30 2016Q3 43 2019/5/31 ASX Daily Returns (%) 44 2019/6/3 45 2019/6/4 0.5873 0.4086 0.6824 -0.8305 46 2019/6/5 47 2019/6/6 48 2019/6/7 49 2019/6/11 -0.8263 0.6487 0.0064 50 2019/6/12 2019/6/13 51 52 2019/6/14 0.0273 -0.3985 0.8486 53 2019/6/17 2019/6/18 0.0016 54 0.4159 55 2019/6/19 -0.3345 56 2019/6/20 2019/6/21 58 2019/6/24 0.0543 57 0.9521 0.9922 59 2019/6/25 0.0548 60 2019/6/26 -0.4087 61 2019/6/27 -0.5346 62 2019/6/28 0.7968 63 2019/7/1 -0.5882 64 2019/7/2 -0.0410 65 2019/7/3 -0.8223 66 0.1910 67 -0.4225 68 2016/12/31 201604 2017/3/31 2017Q1 2017/6/30 2017Q2 2017/9/30 201703 2017/12/31 201704 2018/3/31 2018Q1 2018/6/30 201802 2018/9/30 2018Q3 2018/12/31 201804 2019/3/31 2019Q1 2019/7/4 2019/7/5 2019/7/8 0.4179 69 2019/7/9 0.2478 70 2019/7/10 -0.2107 71 2019/7/11 -0.9162 72 2019/7/12 0.7099 73 2019/7/15 0.6938 74 2019/7/16 0.5926 75 2019/7/17 1.7407 76 2019/7/18 0.3706 77 2019/7/19 0.1631 78 2019/7/22 -0.2903 79 2019/7/23 -0.5515 80 2019/7/24 -0.0635 81 2019/7/25 0.5099 82 2019/7/26 -0.6908 83 2019/7/29 -0.7438 84 2019/7/30 0.0751 -1.1943 0.1883 83 0.4122 0.3853 84 0.9541 85 1.5891 86 -0.0397 -0.0199 87 0.1773 88 -0.3525 89 0.5987 1.1887 90 0.5911 91 -0.5473 0.2195 92 -0.1110 93 -0.2628 0.3885 94 -0.7125 95 0.4427 0.0767 96 0.4855 97 0.4861 0.4957 98 -1.1716 -0.0974 0.3616 100 0.3931 101 -0.2918 -0.6496 -0.1804 103 0.4864 IORD Close 7.15 45 7.14 46 7.18 47 7.11 48 QE(t) 104.0 -35.5 -12.5 0.0 0.0 -141.0 -141.0 -167.5 -167.5 -689.0 -748.0 OO 2019/7/29 2019/7/30 2019/7/31 2019/8/1 2019/8/2 2019/8/5 2019/8/6 2019/8/7 2019/8/8 2019/8/9 2019/8/12 2019/8/13 2019/8/14 2019/8/15 2019/8/16 2019/8/19 99 2019/8/20 2019/8/21 2019/8/22 102 2019/8/23 2019/8/26 104 2019/8/27 -0.3626 0.7700 105 2019/8/28 -0.1358 106 2019/8/29 0.4992 0.7748 107 2019/8/30 0.6094 -0.3608 0.4769 0.2828 0.0 0.0 -68.0 -68.0 208.0 208.0 398.0 398.0 207.5 QE(t-1) 2019/7/10 2019/7/11 2019/7/12 2019/7/15 2019/7/16 2019/7/17 2019/7/18 2019/7/19 2019/7/22 2019/7/23 2019/7/24 2019/7/25 2019/7/26 104.0 104.0 -35.5 -12.5 2019/6/4 2019/6/5 2019/6/6 2019/6/7 7.1 49 2019/6/11 7.25 50 2019/6/12 7.31 51 2019/6/13 7.23 52 2019/6/14 7.2 53 2019/6/17 7.25 54 2019/6/18 7.29 55 2019/6/19 7.29 56 2019/6/20 7.3 57 2019/6/21 7.32 58 2019/6/24 7.57 59 2019/6/25 7.57 60 2019/6/26 7.48 61 2019/6/27 7.45 62 2019/6/28 7.37 63 2019/7/1 7.66 64 2019/7/2 7.66 65 2019/7/3 7.52 66 2019/7/4 7.41 67 2019/7/5 7.52 68 2019/7/8 7.4 69 2019/7/9 7.44 70 7.51 7.45 71 7.26 72 7.44 73 7.74 74 7.89 75 7.97 76 7.85 77 7.86 78 7.72 79 7.51 80 7.59 81 7.69 82 7.5 83 7.34 84 7.18 85 7.1 2019/7/29 2019/7/30 2019/7/31 OO 0.0 0.0 QE(t-4) QE(t-5) -73.0 161.0 161.0 104.0 104.0 -35.5 -12.5 -141.0 -141.0 -167.5 -167.5 -141.0 -689.0 -141.0 -141.0 -748.0 -167.5 -141.0 0.0 -167.5 -167.5 0.0 -689.0 -167.5 -68.0 -748.0 -68.0 -689.0 -748.0 0.0 208.0 208.0 0.0 398.0 398.0 0.0 0.0 000 -73.0 -73.0 161.0 161.0 104.0 104.0 -35.5 -12.5 0.0 0.0 -68.0 -68.0 208.0 -68.0 -68.0 0.0 0.0 0.4769 0.2828 -0.4748 -0.3479 -0.2990 -1.8955 -2.4427 0.6391 0.7455 0.2482 0.0896 -0.3308 0.4171 -2.8472 -0.0406 966 1.1999 -0.9427 0.2853 0.3276 -1.2724 0.4829 0.4543 0.1046 1.4875 7.11 7.08 7.06 7.08 7.19 7.15 6.95 7.02 6.91 6.91 7.04 7.26 7.35 7.34 7.32 7.34 7.46 7.31 7.39 7.41 7.43 7.47 7.65 7.58 7.42 7.45 7.52 7.53 7.43 7.42 7.43 7.36 7.51 7.58 7.69 7.75 7.76 7.85 7.86 7.86 7.94
Use the dataset ORG_QEarnings and perform the following regression: QE QEt-4 = a + ß* (QEt-1 - QEt-5) + Et where QE denotes quarterly earnings of Origin Energy Ltd in quarter t. a is the constant term (i.e., the intercept) and & is the error term. The regression should be performed using 20 quarters of earnings data. Report your regression estimates in the table below: α = Question 3 a. Based on your regression estimates, compute the expected quarterly earnings for the quarter ending March 31, 2019. b. Compute the forecast errors by applying the following model: QE+ - E(QE₂) |QE| FEt B = = where FE is the forecast error regarding the quarterly earnings of Origin Energy Ltd for quarter t (i.e., the quarter ending March 31, 2019). E(QE) denotes the expected quarterly earnings of Origin Energy Ltd for the quarter ending March 31, 2019. c. Looking at the value of FEt, what is your expectation regarding the direction of the short-term movement in the stock price of the company?
Transcribed Image Text:Use the dataset ORG_QEarnings and perform the following regression: QE QEt-4 = a + ß* (QEt-1 - QEt-5) + Et where QE denotes quarterly earnings of Origin Energy Ltd in quarter t. a is the constant term (i.e., the intercept) and & is the error term. The regression should be performed using 20 quarters of earnings data. Report your regression estimates in the table below: α = Question 3 a. Based on your regression estimates, compute the expected quarterly earnings for the quarter ending March 31, 2019. b. Compute the forecast errors by applying the following model: QE+ - E(QE₂) |QE| FEt B = = where FE is the forecast error regarding the quarterly earnings of Origin Energy Ltd for quarter t (i.e., the quarter ending March 31, 2019). E(QE) denotes the expected quarterly earnings of Origin Energy Ltd for the quarter ending March 31, 2019. c. Looking at the value of FEt, what is your expectation regarding the direction of the short-term movement in the stock price of the company?
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Question 3 a. Based on your regression estimates, compute the expected quarterly earnings for the quarter ending March 31, 2019. b. Compute the forecast errors by applying the following model: QE+ - E(QE₂) |QE| FE = where FE is the forecast error regarding the quarterly earnings of Origin Energy Ltd for quarter t (i.e., the quarter ending March 31, 2019). E(QE) denotes the expected quarterly earnings of Origin Energy Ltd for the quarter ending March 31, 2019. c. Looking at the value of FEt, what is your expectation regarding the direction of the short-term movement in the stock price of the company?
Transcribed Image Text:Question 3 a. Based on your regression estimates, compute the expected quarterly earnings for the quarter ending March 31, 2019. b. Compute the forecast errors by applying the following model: QE+ - E(QE₂) |QE| FE = where FE is the forecast error regarding the quarterly earnings of Origin Energy Ltd for quarter t (i.e., the quarter ending March 31, 2019). E(QE) denotes the expected quarterly earnings of Origin Energy Ltd for the quarter ending March 31, 2019. c. Looking at the value of FEt, what is your expectation regarding the direction of the short-term movement in the stock price of the company?
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