Question: Continue with Problem 8.14. Is there multicollinearity in the previous problem? How do you know? Problem 8.14 You are given the annual data in Table

Continue with Problem 8.14. Is there multicollinearity in the previous problem? How do you know?
Problem 8.14
You are given the annual data in Table 8-5 for the United States for the period 1971 to 1986. Consider the following aggregate demand function for passenger cars:
InYi = B1 + B2InX2t + B3InX3t + B4InX4t + B5InX5t + B6InX6t + ut
where In = the natural log
DEMAND FOR NEW PASSENGER CARS IN
THE UNITED STATES, 1971 TO 1986

Year x2 X4 1971 10227 .0 121.3 776.8 4.89 79367 1972 10872 0 125.3 839.6 4.582153 1973 1350 133.949.8 7.38 85064 1974 8775 7.5 147.7 1038.4 8.61 86794 1975 8539 127.6 161.2 1142.8 6.16 85846 1976 9994 135.7 70.5 1252.6 5.22 88752 1977 1046 142.9 181.5 1379.3 5.50 92017 1978 11164 153.8 195.4 1551 7. 96048 1979 10559 166.0 217.4 1729.3 10.25 98824 1980 8979 79.3246.8 1918.0 11.28 99303 1981 1982 7980 197.6 289. 2261.4 11.20 99526 1983 9179 202.6 298.4 2428. 8.69 100834 984 10394 208.5 311.1 2670.6 9.65 105005 1985 11039 215.23222 2841.1 7.75 107150 1986 1450 224.4328.4 3022.1 6.31 109597 8535 190.2 272.4 2127.6 13.73 100397

Step by Step Solution

★★★★★

3.21 Rating (162 Votes )

There are 3 Steps involved in it

1 Expert Approved Answer

Step: 1 Unlock

From the results given in problem 814 multicolline... View full answer

Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock

Step: 3 Unlock

Document Format (1 attachment)

849-M-E-E-A (324).docx

120 KBs Word File

Students Have Also Explored These Related Econometric Questions!

Regress Y against X1, X2, and X3 with the following sample data: a. What is the regression equation? b. Change the first observation of X3 from 8.00 to 9.00. Repeat the regression. What is the new...

Table 8-7 on the textbook's Web site gives data on imports, GDP, and the Consumer Price Index (CPI) for the United States over the period 1975-2005. You are asked to consider the following model: In...

Continue with Problem C.14, but now assume that X and y are positively correlated with a correlation coefficient of 0.6. Problem C.14 If X ~ N(10, 3) and Y ~ N(15, 8), and if X and Y are independent,...

Assess the long-term profit potential of the three industries in whichDePaulcompetes (staffing, security, contract packaging) by applying Porter's five-force model. Portland, Oregon. DePaul...

12:38 4 Assignment Details MTH 154-N41A: Quantitative Reasoning (SP21) MTH 154 Excel Project In this major project, you will create an Excel file and answer questions about linear and exponential...

Hello. Can you help with this four question problem? Case PRIVATE EQUITY CASE: MERGER CONSOLIDATION The questions below COMBINE the Ohio & Maryland PT acquisitions as if they are a single c Learning...

Q1-Explain how the EBIT Chart works (inputs determining the outputs-the two lines on the chart Case Leahy Bread Company (LBC) in Cohen Finance Workbook, page 111( a 'caselette') SEE THE IS/BS MODEL &...

Journal of Autism and Developmental Disorders, Vol. 32, No. 3, June 2002 ( 2002) Descriptive Epidemiology of Autism in a California Population: Who Is at Risk? Lisa A. Croen,1,3 Judith K. Grether,1...

Prepare the financial analysis to support your decision between bankruptcy,voluntary reorganization,and Chapter11reorganization.It must be complete and prepared in a professional level,with the...

Hi. I'm asked to take this class for graduation but I don't know how to do any of this. Please help me! I'm already devastated with the whole concept and Finance is new to me. Idk what I'm doing in...

Use the result of Exercise 8.54 to find the sampling distribution of R for random samples of size n from the continuous uniform population of Exercise 8.46.

It is time for the annual performance review of Go-Coms account executives. Account values and hours spent each week acquiring and servicing accounts are shown below. Each agent works approximately...

Son negociadores que su mayor estrategia es el relacionamiento con la contraparte, quienes orientan el logro de los objetivos a travs de la relacin que han tenido en el tiempo Grupo de opciones de...

Problem 3.18 Table 3.3 displays the probability function corresponding to the experiment of throwing two dice. Compute E(X) and V (X).

Use the data in 401 KSUBS.RAW for this exercise. The equation of interest is a linear probability model: pira = 0 + 1p401k + 2jnc + 3Jnc2 + 4 age + 5 age2 + u. The goal is to test whether there is a...

The purpose of this exercise is to compare the estimates and standard errors obtained by correctly using 2SLS with those obtained using inappropriate procedures. Use the data file WAGE2.RAW. (i) Use...

Write a two-equation system in "supply and demand form," that is, with the same variable y1 (typically, "quantity") appearing on the left-hand side: (i) If , = 0 or 2 = 0, explain why a reduced form...

Suppose that the average number of Facebook friends users have is normally.r distributed with a mean of '11'3I and a standard deviation of about 54. Assume forty-eight individuals are randomly...

CReate a funtion BuldMatrix That takes n as input and return THe following matrix and vector output d=(1 2 3....n) column. . A=(4X4)

Can you help me figure out the steps? I know straight-line means the same amount of depreciation over the period of years. I just don't know how to set it all up. And then I have no idea how to do...