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Unformatted text preview: Econ 444 Elementary Econometrics (Winter 2010) ANSWERS TO HOMEWORK EXERCISE: 3 1. MULTIPLE CHOICE 1)C 2)A 3)D 2. a. See Eviews output below. 1 b. The sample regression function is : ˆ Y i = 4 . 855176 + 0 . 916609 X 1 i + 0 . 158596 X 2 i SE = (14 . 54034) (0 . 149560) (0 . 041682) t = . 333911 6 . 128684 3 . 804880 N = 24 R 2 = 0 . 9424 c. The slope coefficient estimate ˆ β 1 tells us that if we increase labor input by 1 unit then the output will increase by 0.916609 units. The slope coefficient estimate ˆ β 2 tells us that if we increase labor input by 1 unit then the output will increase by 0.158596 units.Both the estimated slope coefficients, ˆ β 1 and ˆ β 2 are positive which make sense : as you increase your inputs your output should increase. d. We wish to test , H : β 1 = 0 against an alternative hypothesis of β 1 6 = 0 at 5% level of significance. This is a twosided test. From the Eviews output, the tstatistic is given by 6.1286. The next step is to get the critical value,the tstatistic is given by 6....
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This note was uploaded on 04/13/2010 for the course ECON 444 taught by Professor Ogaki during the Winter '07 term at Ohio State.
 Winter '07
 OGAKI
 Econometrics

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