Chapter 2

Question 1

2.1: Simple Linear Regression Model

Answer 1

Question 2

2.1: The Zero Conditional Mean Assumption

Answer 2

Question 3

2.1: Population Regression Function (PRF)

Answer 3

Question 4

2.2: Equation of the Slope Parameter

Answer 4

Question 5

2.2: Equation for the Intercept Parameter

Answer 5

Question 6

2.2: OLS Regression Line/ Sample Regression Function

Answer 6

Question 7

2.3: Total Sum of Squares, Explained Sum of Squares and Residual Sum of Squares

Answer 7

Question 8

2.3: Coefficient of Determination

Answer 8

Question 9

2.4: Δy in level-level, log-level, level-log, and log-log models

Answer 9

Question 10

2.5: The Four Assumptions for Unbiasedness of OLS

Answer 10

Question 11

2.5: Definition of Homoskedasticity

Answer 11

Question 12

2.5: Definition of Heteroskedasticity

Answer 12

Question 13

2.5: Sample Variances of the OLS Estimators

Answer 13

Question 14

2.5: Unbiased Estimator of the Error Variance and Standard Error of Regression

Answer 14

Question 15

2.5: Standard Error of the Estimated Slope Parameter

Answer 15

Question 16

2.5: Proof of Unbiasedness of the OLS Slope Parameter

Answer 16

Question 17

2.5: Proof of Unbiasedness of the OLS Intercept Parameter

Answer 17

Question 18

2.6: Regression Through the Origin

Answer 18