Question: Suppose that we have 10 observations on the response variable, y, and two explanatory variables, x1 and x2, which are given below in matrix form.

Suppose that we have 10 observations on the response variable, y, and two explanatory variables, x1 and x2, which are given below in matrix form.

Suppose that we have 10 observations on the response variable,

a. Compute X’ X, (X’ X)-1, and X’ Y,

b. Compute the least-square estimators of the prediction equation

8425446522 732352 .3 7 .2 .1 1666011546 16g8797

8425446522 732352 .3 7 .2 .1 1666011546 16g8797

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