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1
Economics 102
Problem Set #3
Simple Regression
Due in SmartSite on Monday, May 3 by 10 p.m.
Department of Economics
Professor Siegler
UC Davis
Spring 2010
Instructions:
Please only turn in a
Word document
containing all of the calculations and
explanations.
Use Equation Editor for Question 1 and you can paste in the Excel output, where
appropriate, for Question 2.
1.
Simple Regression the OldFashioned Way
Estimate the regression coefficients with ordinary leastsquares (OLS) for the model
(
ܻ
ൌߙߚܺ
݁
) using the data below without using Excel (although you can use it to
check your work and to find critical values):
Y
X
8
1
12
3
11
2
5
2
A.
Show all of your work in computing
ߙ
ෝ
and
ߚ
.
B.
Show all of your work in computing the coefficient of determination (R
2
) and
interpret its meaning.
C.
At the fivepercent level of significance, can you reject the null hypothesis that
ߚൌ0
?
Show your work and explain.
D.
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This note was uploaded on 10/10/2011 for the course ECN 102 taught by Professor Parman during the Spring '11 term at UC Davis.
 Spring '11
 PARMAN
 Economics

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