PART 2. APPLICATION Using the midterm.wfl data to answer the following questions. Suppose you want to estimate the effects of crop prices and per capita personal consumption expenditures on crop production in United States for the years 1980-2012. Consider the following regression model: Inq c+ Inp, + Inx,+ut Where q crop production index, p - crop prices and x-per capita personal consumption expenditures (for all of your tests use the significance level of 5%) 1. Estimate the model and then a. Test 'Inp' variable for normality by checking J-B statistics. State the null and alternative hypothesis clearly (5 pts). b. What is intercept? Is it significant? What does it refer to? (5 pts) c. Fill the table given below (40 pts): Auxiliary Regression R-square TOL Factor Correlation Analysis Multicollinearity Decision: Durbin-Watson d Test Comment on the residual graph Autocorrelation Decision: White Test Glejser Test Heteroscedasticity Decision: PART 2. APPLICATION Using the midterm.wfl data to answer the following questions. Suppose you want to estimate the effects of crop prices and per capita personal consumption expenditures on crop production in United States for the years 1980-2012. Consider the following regression model: Inq c+ Inp, + Inx,+ut Where q crop production index, p - crop prices and x-per capita personal consumption expenditures (for all of your tests use the significance level of 5%) 1. Estimate the model and then a. Test 'Inp' variable for normality by checking J-B statistics. State the null and alternative hypothesis clearly (5 pts). b. What is intercept? Is it significant? What does it refer to? (5 pts) c. Fill the table given below (40 pts): Auxiliary Regression R-square TOL Factor Correlation Analysis Multicollinearity Decision: Durbin-Watson d Test Comment on the residual graph Autocorrelation Decision: White Test Glejser Test Heteroscedasticity Decision