State with reason whether the following statements are true or false. a. An observation can be influential

Question:

State with reason whether the following statements are true or false.†

a. An observation can be influential but not an outlier.

b. An observation can be an outlier but not influential.

c. An observation can be both influential and an outlier.

d. If in the model Yi = β1 + β2Xi + β3X2i+ uiβ3 turns out to be statistically significant, we should retain the linear term Xi even if β2 is statistically insignificant.

e. If you estimate the model Yi = β1 + β2X2i + β3X3i + ui or Yi = α1 + β2x2i+ β3x3i + ui by OLS, the estimated regression line is the same, where x2i = (X2i − X̅ 2) and x3i = (X3i – X̅3).

Fantastic news! We've Found the answer you've been seeking!

Step by Step Answer:

Related Book For  book-img-for-question

Basic Econometrics

ISBN: 978-0073375779

5th edition

Authors: Damodar N. Gujrati, Dawn C. Porter

Question Posted: