13_InferenceE - Review + testing inequalities 73-261...

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Review + testing inequalities 73-261 Econometrics Wooldridge 4.1-4.2 September 27
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p. 2 © CMU / Y. Kryukov 73-261 MT1 review, + inequality testing Announcements HW 4 is due tomorrow at 5pm Blackboard (no spaces or !@#$% in filename) Professor’s office (slip under the door) Midterm 1 on Wednesday Cell phones are not allowed Formula sheet – 1 letter-sized page Professor office hours (room 336): Monday: 3:15 – 5:15, Tuesday: 1:45 – 3:45 TA office hours (room 308) Tuesday & Thursday, 5-6pm
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p. 3 © CMU / Y. Kryukov 73-261 MT1 review, + inequality testing Plan New rules for inequality testing Your questions
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p. 4 © CMU / Y. Kryukov 73-261 MT1 review, + inequality testing Two-tailed test Primary hypothesis (H 0 ): β j = 0 Implies the distribution of the t -stat: Very high or very low is unlikely Alternative (H 1 ): j 0, reject H0 if is far from zero 1 ~ ) ˆ ( se ˆ = k N j j j t t j t ˆ -5 -4 -3 -2 -1 0 1 2 3 4 5 pdf t Likely (95%) Unlikely (5%) j t ˆ
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13_InferenceE - Review + testing inequalities 73-261...

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