F14_hw4 - STAT425 Fall 2014 Homework#4 Homework 4 Due...

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STAT425 Fall 2014 Homework #4 Oct 23, 2014 Homework 4 Due: Friday, Oct 31, 2014 Problem 1. (Sheather, pp. 122, Ex 1) A full professor of statistics at a major US university is interested in estimating the third quartile of salaries for full professors with 6 years of experience in that rank. You can find the data on page 122 of the textbook (Sheather). a) Draw the scatter plot of Y = the third quartile of salaries versus X = years of experience. Use weighted least squares 1 to estimate the regression line of Y on X . Add the fitted line on your scatter plot. Also add the fitted OLS line on your scatter plot. When showing two lines in the same plot, you should plot them using different line types and also use legend to explain which one is the OLS line and which one is the WLS line. b) Using WLS, estimate the third quartile for salary of full professors with 6 years of expe- rience. Problem 2. (Sheather, pp. 122, Ex 2) Consider regression though the origin (i.e., straight line regression with population intercept known to be zero): y i = βx i + e i

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