Econometrics : MAXIMUM MARKS :20
Simple Linear Regression
Instructor: Prof. Kavita Sardana
E-mail: kavita.sardana@ashoka.edu.in
Instructions
You are expected to upload the soft copy of the word file with answers to the following questions
in additon to the STATA log file by February 11, 5 pm. The assignment carries penalty for
submitting log files that carry multiple codes, error messages, and multiple answers for the same
question (even if the correct answer is reported).
Question1
Bcuse data vote1 from STATA memory. Then estimate β0 and β1 and σ 2 for the following simple
regression model
V oteA = β0 + β1 shareA
(1)
using the given equations
P
(xi − x̄)(yi − ȳ)
P
βˆ1 =
(xi − x̄)2
(2)
βˆ0 = ȳ − βˆ1 x̄
(3)
µ̂i 2
n−2
(4)
2
σ̂ =
P
In the word file report the following,
P
P
P 2
1.
(xi − x̄)(yi − ȳ), (xi − x̄)2 , and
µ̂i .
2. βˆ0 and βˆ1 , estimator of standard error of βˆ0 and βˆ1 , σˆ2 .
1