- CFA Exams
- CFA Level I Exam
- Topic 1. Quantitative Methods
- Learning Module 2. Multiple Regression
- Subject 15. Models with Qualitative Dependent Variables

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**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.

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