Question 3 Each Item 10 Points 30 Points The Ols Can Be Sensitive To Outliers And The Functional Form Matters For Th 1 (37.24 KiB) Viewed 23 times
Question 3 Each Item 10 Points 30 Points The Ols Can Be Sensitive To Outliers And The Functional Form Matters For Th 2 (13.27 KiB) Viewed 23 times
Question 3 (Each item 10 points: 30 Points) The OLS can be sensitive to outliers, and the functional form matters for the regression analysis in many cases. The figure illustrates the Anuscombe's Quartet, which provides four datasets with the same OLS coefficients. 20 15 15 >10 > 10 5 5 0 0 0 0 15 20 5 15 10 X 20 10 X2 20 30 15 15 10 > 10 5 5 0 0 0 0 15 T0 15 10 Х. 10 X (a) Considering the OLS nuptions discussed in previous weeks, choose your favorite, the most plausible ond? Explain Activate
load (b) Are there any second or third best? Explain why they are not as good as the best ones? Are there any other ways to make them better? (e) Using the marginal distribution of X4, draw the histogram (you do not have to draw it perfectly). What is the problem? Hint: X. = {8, 8, 8, 8, 8, 8, 8, 19, 8, 8, 8)
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