5. Suppose that you get the following regression result from a sample of 277 observations: ŷ = 4.57 +0.188x1 – 0.2222 +0

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5 Suppose That You Get The Following Regression Result From A Sample Of 277 Observations Y 4 57 0 188x1 0 2222 0 1 (114.02 KiB) Viewed 101 times

5. Suppose that you get the following regression result from a sample of 277 observations: ŷ = 4.57 +0.188x1 – 0.2222 +0.171x3 – 0.92x4 (0.25) (0.040) (0.21) (0.055) (0.33) R2 = 0.353 The numbers in the parentheses are the heteroskedasticity robust standard errors for the OLS estimates. 2 = (a) Compute t statistics for the coefficients on 22 and 24 (The null hypothesis is that the coefficient is 0) (b) (1.96) = 0.975, where 0 (.) is the CDF of a standard normal distribution. Given this information, explain whether has a significant effect on y or not. How about 24? Explain. (c) Compute the 95% confidence intervals for the estimated coefficients on X2 and X4. (d) What is the risk if we do not use the heteroskedasticity robust standard errors? 22