Question #77
Reading: Reading 1 Multiple Regression
PDF File: Reading 1 Multiple Regression.pdf
Page: 36
Status: Unattempted
Question
A high-yield bond analyst is trying to develop an equation using financial ratios to estimate the probability of a company defaulting on its bonds. A technique that can be used to develop this equation is:
Answer Choices:
A. multiple linear regression adjusting for heteroskedasticity
B. dummy variable regression
C. logistic regression model
Explanation
The only one of the possible answers that estimates a probability of a discrete outcome is
logit or logistic modeling.