Lecture 2

# Lecture 2 - Res Ec 703: Econometrics Order o f Topics And...

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Res Ec 703: Econometrics Order of Topics And Readings For Lecture 2 (September 9, 2010) Source Pagels) Topics Handouts And Readings For The Next Two Classes Syllabus 2 Readings: OR] Chapters 4, 10, and 14 Assignment OR] , page 317, problem 9.7 Number 1 Fisher Franklin Fisher's classic paper on testing regression coefficients. This is intended to be an exposition ofChow's paper "The Chow Test" Material Listed on Lecture 1 Topics Sheet But Not Covered BM 5-28 Background and review material. Cover on your own. Ifyou need clarification, ask me. Notice that the specific topics are listed on the topics sheet for Lecture 1 Plan For Lecture 2 BM 7 Pay attention to the formula for the slope coefficient in the middle ofBM page 7 and to the footnote on the WW page from Lecture 1. I will go through a computer demonstration ofhow the Central Limit Theorem applies to a sample statistic like the sample mean. (Notice five PowerPoint slides and one Minitab set-up). BM 15,17 Four possible asymptotic results BM 29-39 Possible testing situations using F. (Please look at pages 29-32 before next class).

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Res Ec 703: Econometrics Assignment No.1: Assigned September 9, 2010; Due September 21, 2010 Present concise explanations with your statistical output. Consider problem 9.7 on page 317 ofthe text. The relevant data set is presented at the bottom of this page. The easiest way to retrieve the data set is to go to my Resource Economics web site. After typing in the address -- 'Nww.timass.edu/resec/ proceed as follows: (a) Go to Academics, then Courses; (b) Scroll down to Res Ec 703 and click on my web site; (c) click "Data" among the choices at the left; and (4) click on the data set table9.9.txt . . Here is how the problem reads: 9.7 Consider the following total cost fullctioll, where y, represents total cost for the rth finn and x, represents quantity-of output. y, =PI +f31X( +fJ3 X ; +fJ"x: +e, Data on a sampLe of 28 firms in the clothing industry are given in Table 9.9. Your tasks: (1) Use PROC REG in SAS to answer only the first part ofpart (d). That is: (d) .Use 'th~ tow 'Cost function to find least squares estimates of 131' /3,.,133' and. 134' (2) Test for normality ofthe residuals from your regression in (1). I wi111eave it up to
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## This note was uploaded on 12/08/2011 for the course ECON 703 taught by Professor Bernardmorzuch during the Fall '10 term at UMass (Amherst).

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Lecture 2 - Res Ec 703: Econometrics Order o f Topics And...

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