Question: In the regression Y i = 1 + 2 X i + ui suppose we multiply each X value by a constant, say,

In the regression Y_i = β₁ + β₂X_i + ui suppose we multiply each X value by a constant, say, 2. Will it change the residuals and fitted values of Y? Explain. What if we add a constant value, say, 2, to each X value?

Step by Step Solution

★★★★★

3.39 Rating (177 Votes )

There are 3 Steps involved in it

1 Expert Approved Answer

Step: 1 Unlock

The residuals and fitted values of Y will not change Let Y i 1 2 X i u i and Y i 1 2 Z ... 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 (2 attachments)

1529_605d88e1cb923_656144.pdf

180 KBs PDF File

1529_605d88e1cb923_656144.docx

120 KBs Word File

Students Have Also Explored These Related Econometrics Questions!

Are the following models linear regression models? Why or why not? a. Y i = e 1 + 2Xi + ui b. Y i = 1 / 1 + e 1 + 2Xi + ui c. ln Y i = 1 + 2 (1/X i ) + u i d. Y i = 1 + (0.75- 1 )e -2(Xi-2) +ui e....

Consider the following model: Y i = e 1+2Xi / (1 + e 1+2Xi ) As it stands, is this a linear regression model? If not, what trick, if any, can you use to make it a linear regression model? How would...

In the real world, government provision of public goods usually entails the use of distortionary taxes to raise the required revenues. Consider the pure public good national defense, a good provided...

Logarithms and polynomials Interaction effects Dummy variables ECMT1020: Introduction to Econometrics Lecture 10: Multivar. regr. & transformations Peter Exterkate peter.exterkate@sydney.edu.au...

Math\t107-6381\t-\tQuiz\t#4\t-\tSchultz\t-\tDue\tFebruary\t21,\t2016\t-\tpage\t1\tof 3 Follow\tthese\tdirections\tcarefully. This\tquiz\tis\tdue\tby\t11:59\tEastern\ttime\ton\tFebruary\t21,\t2016. o...

Login Required user id password Login Forgotten your password? ECONOMICS 2123B - ECONOMETRICS II LECTURE 5: SPECIFICATION OF REGRESSION VARIABLES George Orlov Department of Economics Western...

Exercises Chapter 2 2.1 Marginal and conditional probability: The social mobility data from Section 2.5 gives a joint probability distribution on (Y1 , Y2 )= (father's occupation, son's occupation)....

9/14/10 12:39 PM Page 381 Chapter dug84356_ch06a.qxd 6 Rational Expressions Advanced technical developments have made sports equipment faster, lighter, and more responsive to the human body. Behind...

Please answer all the required questions in detail I hope the answer is not copy-paste I hope that the answer will be according to the concepts in the chapter 3 The following article summarizes the...

A 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 B C D E F G Estimate Estimation Error Square of Error Template for Linear Regression Time...

In each of the following cases, explain whether the policymakers response to a beneficial supply shock was accommodating, extinguishing, or neutral. (a) The inflation rate fell, but the unemployment...

The Riverside Mica Home Warehouse and Build, situated in Vanderbijlpark, was founded in 2006 and the business forms part of Sub-Saharan Africas largest hardware franchise. This Mega Mica offers a...

Which of the following bank accounts offers the lowest effective annual refurn? An account that pary BW APR with monthly compoundine, An account that puys 8 A . A with quarterly compounding An...

2. If the Fed makes an open market sale of $1 million of securities, who can buy the securities? What initial changes occur if the Fed sells to a bank?

Fifteen years ago, the town of Easton decided to increase its annual spending on education so that its high school graduates would be able to earn higher wages. Now Easton has asked you to evaluate...

In 2003, ten states increased the taxes they placed on cigarettes. Because taxes increase the price of cigarettes, wed expect that a tax increase would reduce the consumption of cigarettes. In Table...

A simple alternative to the fixed effects model is called the differencing model, in which all the variables and the error term are expressed as differences. For a panel data set with two time...

North Cascades Company is considering a new project that will require an initial cash investment of $250,000. The project will produce no cash flows for the first two years. The projected cash flows...

Watch the Monty Python skit Argument Clinic on YouTube. What are the stases used by the two men in their argument?

12-10 You are attempting to value a put option with an exercise price of $107 and one year to explration. The underlying stock pays no dividends, Its current price is $107, and you belleve It has a...