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Problem:
(a) Why is an error term added to a regression and explain its importance in the OLS procedure?
(b) Suppose we have a linear equation with a constant term, one explanatory variable and an error term, show in details the steps required, using the OLS procedure, to derive the estimates of the constant term and that of the coefficient of the explanatory variable.
(c) Suppose a researcher wants to test whether the returns on a company stock (y) show unit sensitivity to two factors (factor x2 and factor x3) among three considered. The regression is carried out on 144 monthly observations. The regression is: Yt = β1 + β2x2t + β3x3t + β4x4t+ ut
i) What are the restricted and unrestricted regressions?
ii) If the two RSS are 502.4 and 302.8 respectively, perform an F-test of the restriction, showing all the required steps.
(d) How are the t-test and the F-test related and describe in which cases they cannot be applied?
1. What is a resource market? 2. Describe resource demand and resource supply. 3. Define derived demand. 4. Describe the resource market demand and supply curve. 5. Define a te
Labor cannot be divided from the human being who provides it. The result of the inseparability of labor from the people who gives it, is that the wage for the last hour worked mus
Deadline is 20 Hours... 1. A. Explain how one derives the indifference curves from a 3-dimensional utility function. Draw a graph and explain. Which principle explains the concav
do you give solutions
explaination of quasi rent theory
i want an application on indifference curve of a specific firm? can i get it easily?
Explain the term economic efficiency? Answer: Economic Efficiency means full utilization of all available resources in economy i.e. to produce the needed amount of goods and
Reasons for International Trade?
discuss the significance of paration research
ELASTICITIES OF SUPPLY AND DEMAND Usually, elasticity is a measure of the sensitivity of one variable to the other. It told us the percentage change in one variable in re
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