When calculating the predicted output of a regression model, I often struggle with inputting the independent variables in the correct format. In this instance (Reading 10, practice problem 4) I am asked to input a 1% decline in NASDAQ spreads and input it as 0.01. Referring to the solution, I can see that this should have been input as 1 not 0.01.
If the question phrases the independent variable as “Percentage decline in NASDAQ spreads”, can I safely assume that I should input a percentage as an integer rather than a decimal? How can I decide which format is correct? In this case using the decimal input 0.01 gave a decline in spreads of about 15% compared to the correct 45% decline in spreads so a common sense approach to the answer doesn’t help.