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Unformatted text preview: r space is
available for other rooms (kitchen, living room, etc.). Hence the overall value of
the house may indeed be lower. Þ One must be careful in interpreting β i ' s as ‘marginal contributions’ to the
total when there are interdependencies among the explanatory variable. ˆ
8. (i) var(β1 ) = σ2
å i ( xi − x )2 ˆ
So for β11 : ( x1 ,.., x10 ) = (0,.., 0,100,..,100) Þ x1 = 50
Þ var(β11 ) = (.00004) σ2
and for β12 : ( x1 ,.., x10 ) = (5,15,..,95) Þ x2 = 50
Þ var(β12 ) = (.00012) σ2
Þ β11 is more efficient (sa...
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This homework help was uploaded on 02/16/2014 for the course ESE 302 taught by Professor Ese302 during the Fall '08 term at UPenn.
- Fall '08