Consider the following simple linear regression: consumption = B + Binflation + et where consumption represents...
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Consider the following simple linear regression: consumption = B₁ + B₂inflation + et where consumption represents the aggregate consumption in a country in week t and inflation, represents the country's average inflation rate in week t. = 0.13 Researcher A estimates the model using data from 2018 to 2019 and obtained the following estimation results: ₁ = 54, ß₂ = −0.81, R² Researcher B estimates the model using data from 2020 to 2021 and obtained the following estimation results: 3₁ Investigate these outcomes. Which of the statements below is correct? = = 51, B₂ = -0.62, R² = 0.19 2 The total variation of the outcome variable is greater in 2018-2019 than in 2020-2021. One of these two equations must be misestimated since it is impossible to have a larger R2 with smaller point estimates. Inflation has a larger impact on consumption in 2020-2021 than in 2018-2019. Inflation explains a larger proportion of the variation in consumption during 2020-2021 than 2018-2019. Consider the following simple linear regression: consumption = B₁ + B₂inflation + et where consumption represents the aggregate consumption in a country in week t and inflation, represents the country's average inflation rate in week t. = 0.13 Researcher A estimates the model using data from 2018 to 2019 and obtained the following estimation results: ₁ = 54, ß₂ = −0.81, R² Researcher B estimates the model using data from 2020 to 2021 and obtained the following estimation results: 3₁ Investigate these outcomes. Which of the statements below is correct? = = 51, B₂ = -0.62, R² = 0.19 2 The total variation of the outcome variable is greater in 2018-2019 than in 2020-2021. One of these two equations must be misestimated since it is impossible to have a larger R2 with smaller point estimates. Inflation has a larger impact on consumption in 2020-2021 than in 2018-2019. Inflation explains a larger proportion of the variation in consumption during 2020-2021 than 2018-2019.
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The total variation of the outcome variable is greater in 20182019 than in 20202021 The model explains a greater proportion of the variation in the ou... View the full answer
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