Question: Let xt be the 1 3 1k 1 12 vector of explanatory variables for observation t. Show that the OLS estimator b^ can be written

Let xt be the 1 3 1k 1 12 vector of explanatory variables for observation t. Show that the OLS estimator b^ can be written as b^ 5 a a n

t51 xt rxtb 21 a a n

t51 xt rytb.

Dividing each summation by n shows that b^ is a function of sample averages.

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