- CFA Exams
- CFA Level I Exam
- Study Session 2. Quantitative Methods (1)
- Reading 5. Multiple Regression
- Subject 15. Models with Qualitative Dependent Variables

###
**CFA Practice Question**

Unlike probit or logit models, discriminant analysis models yield:

A. a score which is used to predict the future occurrence of a qualitative dependent variable.

B. financial ratios useful to equity and credit analysts.

C. a probability that the qualitative dependent variable is present.

**Explanation:**Discriminant analysis models yield a score, used to predict the future occurrence of a qualitative dependent variable. For example, Altman's Zeta (r) analysis yields a probability of bankruptcy.

###
**User Contributed Comments**
0

You need to log in first to add your comment.