Lecture 13 2010

Lecture 13 2010 - PRS 1: Last week, we calculated 90%...

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1 PRS 1: Last week, we calculated 90% confidence intervals estimates for the effect of mileage on price for used 2004 Honda Accords, β 1 . The true population parameter value is – $0.0894 per mile. Does your 90% confidence interval contain this true value? Yes – enter 1 No – enter 0. III. Simple Regression. A. Introduction B. Population Regression Equation C. Sample Regression Equation D. Ordinary Least Squares E. Classical Regression Model. F. Properties of OLS Estimators ( BLUE ) G. Estimator for σ 2 H. Inference (we’ve done this before!) H. Inference in Simple Regression 1. Introduction: Inference : Combine point estimates and sampling distribution information. 2. σ 2 known 3. σ 2 NOT known
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2 H. Inference (cont.) 2. σ 2 known • Experiment – we knew σ 2 • Calculate the true standard error for the sampling distribution. CI formula : • Hypothesis test: Z calc vs. Z α /2 or Z α The Fisher equation for interest rates: Nominal Rate Real Rate + Inflation . In the real world, this will not be an exact
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Lecture 13 2010 - PRS 1: Last week, we calculated 90%...

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