Suppose y= Bo + B111 + B212 + u (1) and MLR.1 to MLR.6 are satisfied. When we use OLS to estimate this model with n=100

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Suppose Y Bo B111 B212 U 1 And Mlr 1 To Mlr 6 Are Satisfied When We Use Ols To Estimate This Model With N 100 1 (60.67 KiB) Viewed 70 times

Suppose y= Bo + B111 + B212 + u (1) and MLR.1 to MLR.6 are satisfied. When we use OLS to estimate this model with n=100 observations, estimates (and non-robust estimated standard errors) are: Bo 1 (???) B1 = 5 (3) B2 = 6 (???) where some standard errors are left as question marks for now. Define 11 as the sample average of 11, and 12 as the sample average of 12, and define Tij as observation i for variable 2. Suppose that: Σαι 3 (12 - 12)2 = 25 . Σ (Iil - 11)(12 - 12) = 6 (a) (points: 4) Test the mull hypothesis that B1 = -1 against the alternative hypothesis that B1 -1. What is the test statistic? What is the critical value for this test at the 5% level? Do you reject the null at the 5% level? (For this problem set, find the critical value by looking in the back of your book, using degrees of freedom closest to the mimber in this problem. For example, if there were 55 degrees of freedom, you should use the critical value for 60 degrees of freedom.) (b) (points: 4) Test the null hypothesis that Bı = -1 against the alternative hypothesis that B, < -1. What is the test statistic? What is the critical value for this test at the 5% level? Do you reject the null at the 5% level?