Question: C13.6 Use CRIME3.RAW for this exercise. (i) In the model of Example 13.6, test the hypothesis H0: 1 2. (Hint: Define 1 1
C13.6 Use CRIME3.RAW for this exercise. (i) In the model of Example 13.6, test the hypothesis H0: 1 2. (Hint: Define 1 1 2 and write 1 in terms of 1 and 2. Substitute this into the equation and then rearrange. Do a t test on 1.) (ii) If 1 2, show that the differenced equation can be written as log(crimei ) 0 1 avgclri ui , where 1 21 and avgclri (clrprci,1 clrprci,2)/2 is the average clear-up percentage over the previous two years. (iii) Estimate the equation from part (ii). Compare the adjusted R-squared with that in (13.22). Which model would you finally use?
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