Explain the nature of auto correlation Suppose that a random sample of 200 twenty-year-old men is
Question:
Explain the nature of auto correlation
Suppose that a random sample of 200 twenty-year-old men is selected from a population and their heights and weights are recorded. A regression of weight on height is estimated as follows:
Weight 44.73+0.7Height, Square=0.81 SE (B0) = 0.97, SE (B1) = 0.58, SE denotes a standard error.
a)State the hypotheses
b)Conduct the t-test
c)Test whether not the estimated coefficient of " Height" is statistically significant at 5% significance level ( the critical value for the t- test at 5% significance level is 1.96.
d)Interpret the results
e)What does R squared = 0.81 mean?
f)If a mean's Height is 180 cm, what is his estimated weight (weight is measured in kg?
Question two
Using an example illustrate the Omitted variable Bias ( 3mks)
Explain how you would remedy severe multicollinearity in your data (12mks)
Question three
With the aid of equations, explain the difference between a stochastic and a deterministic relationship
Explain the difference between cross-sectional data and time series data- Give examples of each (6mkd)
Using an example illustrate the dummy trap (5mks)
Business Statistics In Practice
ISBN: 9780073401836
6th Edition
Authors: Bruce Bowerman, Richard O'Connell