The following model is specified: y1 = 1y2 + 11x1 + 1, y2 = 2y1 + 22x2
Question:
The following model is specified: y1 = γ1y2 + β11x1 + ε1, y2 = γ2y1 + β22x2 + β32x3 + ε2. All variables are measured as deviations from their means. The sample of 25 observations produces the following matrix of sums of squares and cross products:
a. Estimate the two equations by OLS.
b. Estimate the parameters of the two equations by 2SLS. Also estimate the asymptotic covariance matrix of the 2SLS estimates.
c. Obtain the LIML estimates of the parameters of the first equation.
d. Estimate the two equations by 3SLS.
e. Estimate the reduced-form coefficient matrix by OLS and indirectly by using your structural estimates from Partb.
Transcribed Image Text:
У1 У2 X1 X2 X3 у 20 6 4 3 5 y2 6 6 10 3 6 7 XI 4352 X2 3 6 X3 5 7 523 2 10 8 38 15
Fantastic news! We've Found the answer you've been seeking!
Step by Step Answer:
Answer rating: 60% (20 reviews)
52 3 The relevant submatrices are XX 2 10 8 38 15 10 y132 6 XZ Z Z 6 6 7 4 2 3 35 6 2XZ Zy 4 ZY2 The ...View the full answer
Answered By
JAPHETH KOGEI
Hi there. I'm here to assist you to score the highest marks on your assignments and homework. My areas of specialisation are:
Auditing, Financial Accounting, Macroeconomics, Monetary-economics, Business-administration, Advanced-accounting, Corporate Finance, Professional-accounting-ethics, Corporate governance, Financial-risk-analysis, Financial-budgeting, Corporate-social-responsibility, Statistics, Business management, logic, Critical thinking,
So, I look forward to helping you solve your academic problem.
I enjoy teaching and tutoring university and high school students. During my free time, I also read books on motivation, leadership, comedy, emotional intelligence, critical thinking, nature, human nature, innovation, persuasion, performance, negotiations, goals, power, time management, wealth, debates, sales, and finance. Additionally, I am a panellist on an FM radio program on Sunday mornings where we discuss current affairs.
I travel three times a year either to the USA, Europe and around Africa.
As a university student in the USA, I enjoyed interacting with people from different cultures and ethnic groups. Together with friends, we travelled widely in the USA and in Europe (UK, France, Denmark, Germany, Turkey, etc).
So, I look forward to tutoring you. I believe that it will be exciting to meet them.
3.00+
2+ Reviews
10+ Question Solved
Related Book For
Question Posted:
Students also viewed these Econometric questions
-
The following model is specified:y 1 = 1 y 2 + 11 x 1 + 1 ,y 2 = 2 y 1 + 22 x 2 + 32 x 3 + 2 . All variables are measured as deviations from their means. The sample of 25 observations produces...
-
A random sample of 25 observations gave the following summary statistics: Xi = 234 and X i 2 = 3048. Assuming that the data can be looked upon as a random sample from a normal population, construct...
-
A simple random sample of 25 observations is derived from a normally distributed population with a known standard deviation of 8.2. a. Is the condition that is normally distributed satisfied?...
-
United Research Associates (URA) had received a contract to produce two units of a new cruise missile guidance control. The first unit took 4,000 hours to complete and cost $ 30,000 in materials and...
-
You have $10,000 to invest and are considering either a consol (a perpetual bond) or preferred shares of Canada Leasing. The consol has a $ 1,000 par value, an annual coupon rate of 4 %, and never...
-
The Ploughman family has owned and operated a 640-acre farm for several generations. The family now needs to make a decision about the mix of livestock and crops for the coming year. By assuming that...
-
For a study of statistics students, the prediction equation relating \(y=\) final grade (as score), to \(x_{1}=\) midterm grade (as score) and \(x_{2}=\) number of classes missed is...
-
Nick Santiago purchased a used for $35,000. Before the tractor could be used, it required new tires, which costs $2,200, and an overhaul, which cost $2,800. Its first tank of fuel cost $150. The...
-
Calculate the free air flow requirements for the following applications: 1. A 2 inch bore cylinder with a 10 inch stroke extends in 0.5 seconds when supplied with 83 PSIG air. The compressor intake...
-
There are 2 shinobis with chakra levels 5 and 10 respectively and the desired sum of chakra levels is utmost 15 Starting with ke0, suy of chakra levels after attack max(5-0,0) + max(10- 0,0) 5+10 15....
-
Obtain the reduced form for the model in Exercise 1 under each of the assumptions made in parts a and in parts b1 and b9.
-
For the model y1 = 1y2 + 11x1 + 21x2 + 1, y2 = 2y1 + 32x3 + 42x4 + 2, show that there are two restrictions on the reduced-form coefficients. Describe a procedure for estimating the model while...
-
The following selected transactions were taken from the records of Silhouette Company for the year ending December 31, 2014: Mar. 4 Wrote off account of Myron Rimando, $3,210. May 19 Received $2,280...
-
Consider the following wage equation where \(E D U C=\) years of education and \(E X P E R=\) years of experience: Suppose that observations on EXPER are not available, and so you decide to use the...
-
RESET suggests augmenting an existing model with the squares or the squares and higher powers of the predictions \(\hat{y}_{i}\). For example, \(\left(\hat{y}_{i}^{2} ight)\) or...
-
In this exercise, we will explore some of the factors predicting costs at American universities using the data file poolcoll2 and observations outside the great recession. Let \(T C=\) the real...
-
\(x_{1}=30, n_{1}=225, x_{2}=40, n_{2}=317,95 \%\) confidence Construct a confidence interval for \(p_{1}-p_{2}\) at the given level of confidence.
-
Use an \(F\)-test to jointly test the relevance of the two variables \(X T R A \_X 5\) and \(X T R A \_X 6\) for the family income equation in Example 6.12 and Table 6.1. Data From Example 6.12:- To...
-
A new project will cost \(\$ 80,000\) initially and will last for 7 years, at which time its salvage value will be \(\$ 2,500\). Annual revenues are anticipated to be \(\$ 15,000\) per year. For a...
-
1-Stern observed all of the following results EXCEPT _______ in his experiment. A-one of the recombinant phenotypes was associated with an X chromosome of normal length B-the number of car, B+ male...
-
In one experiment, 2.18 g sodium was allowed to react with 16.12 g chlorine. All the sodium was used up, and 5.54 g sodium chloride (salt) was produced. In a second experiment, 2.10 g chlorine was...
-
To continue the analysis in Question 4, consider a nonparametric regression of G/Pop on the price. Using the nonparametric estimation method in Section 16.4.2 fit the nonparametric estimator using a...
-
The extramarital affairs data analyzed in Section 22.3.7 can be reinterpreted in the context of a binary choice model. The dependent variable in the analysis is a count of events. Using these data,...
-
Assume that the distribution of x is f (x) = 1/, 0 x . In random sampling from this distribution, prove that the sample maximum is a consistent estimator of . Note: You can prove that the maximum...
-
Design a power transmission system to connect a DC motor to its load. The motor is given in the motor catalogue as a BM1400 motor. You must create a transmission which will connect to this motor and...
-
SDJ, Incorporated, has net working capital of $3,320, current liabilities of $4,550, and inventory of $4,600. a. What is the current ratio? b. What is the quick ratio?
-
Calculate the final selling price to the nearest cent and markdown percent to the nearest hundredth percent: Original selling price $4,900 First markdown 20% Second markdown 10% Markup 12% Final...
Study smarter with the SolutionInn App