Discuss the properties of this estimator

Reference no: EM131132467

An investigator correctly believes that the relationship between two variables X and Y is given by

Yi = β1 + β₂Xi + ui,

Given a sample of n observations, the investigator estimates β₂ by calculating it as the average value of Y divided by the average value of X. Discuss the properties of this estimator. What difference would it make if it could be assumed that β₁ is equal to 0?

Reference no: EM131132467

Questions Cloud

Define the class of linear estimators : Let Y1, Y2,...,Yn be n i.i.d. random variables with common mean µ and common variance σ2. Let Y¯ denote the sample average. Define the class of linear estimators of µ

What is the marginal revenue of the 101st pound of heirloom : What is the marginal revenue of the 101st pound of heirloom tomatoes?

Prepare a balance sheet for the bank : What is the maximum amount by which the money supply can be increased as a result of First Bank's new loan?

What is the amount of goodwill resulting from the business : On April 1, 20X1, it was determined that the inventory of Simon had a fair value of $190,000, and the property and equipment (net) had a fair value of $560,000. What is the amount of goodwill resulting from the business combination?

Discuss the properties of this estimator : Given a sample of n observations, the investigator estimates β2 by calculating it as the average value of Y divided by the average value of X. Discuss the properties of this estimator. What difference would it make if it could be assumed that β1 is..

Are the standard errors in the table good estimates : Are the standard errors in the table good estimates of this standard deviation?

Evaluate the impact of the adjustments on the regression : The researcher initially fits the equation using OLS regression analysis. However, suspecting that tax evasion causes both Y and X to be substantially underestimated, the researcher adopts two alternative methods of compensating for the under-repo..

Entrepreneur who was denied the permision to form a bank : Name an entrepreneur in Kenya who was denied the permision to form a bank and later granted the permit and which bank is it?

Determine the positive and negative impact of peers : Determine the positive and negative impact of peers and changes in peer relations from middle childhood to adolescence. Please share personal examples and Examine additional pressures faced in adolescence compared to middle childhood.

User Account

All Pages