Question: QUESTION ONE i. Explain the difference between panel data and time series data. Give examples of each (4mks) ii. Manga run a regression analysis using

QUESTION ONE i. Explain the difference between panel data and time series data. Give examples of each (4mks) ii. Manga run a regression analysis using time series data and found the following: = 100 + 30, R- Square = 0.63 (0 ) = 4 , (1) = 10, SE denotes standard error a) State the hypotheses (2mks) b) Conduct the t-test (4mks) c) Test whether or not the estimated coefficient of Interest Rate is statistically significant at 5% significance level (the critical value for the t-test at 5% significance level is 1.96) (2mks). d) Interpret the results (2mks) e) If Interest Rate is 1.2 percent, what is his estimated Profit (profit is measured in USD)? (2mks) f) What does R-squared=0.63 mean? (2mks) iii. Explain the difference between a parameter and an estimate of a regression function (2mks).

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