Question: Continue with Question 6.6 but now consider the following model: Yi = B0 + B1Xi + B2D2i + B3D3i + B4 (D2iXi) + B5 (D3iXi)
Yi = B0 + B1Xi + B2D2i + B3D3i + B4 (D2iXi) + B5 (D3iXi) + ui
a. What is the difference between this model and the one given in Question 6.6?
b. What is the interpretation of B4 and B5?
c. If B4 and B5 are individually statistically significant, would you choose this model over the previous one? If not, what kind of bias or error are you committing?
d. How would you test the hypothesis that B4 = B5 = 0?
Step by Step Solution
3.54 Rating (178 Votes )
There are 3 Steps involved in it
a The model given in the previous question assumes that the ave... View full answer
Get step-by-step solutions from verified subject matter experts
Document Format (1 attachment)
849-M-E-E-A (297).docx
120 KBs Word File
