Econometrics Question: Consider the data generating process Y= β1+ β2Xi+β3Zi+β4Wi+β5Pi+β6Ti+e e~N(0, σ^2) i. Write the null hypothesis...

Econometrics Question:

Consider the data generating process

Y= β1+ β2Xi+β3Zi+β4Wi+β5Pi+β6Ti+e e~N(0, σ^2)

i. Write the null hypothesis H0: β4=5 and β2+β3=0 and 2β5-4β6=0 in Rβ-q notation.

ii. Discuss how would test these conjectures in practice assuming that the variance is known.

iv. Discuss how you would test the null-hypothesis Ho: β2/β3= β4 against Ha: β2/β3≠β4.

Solutions

Expert Solution

Rahul Sunny answered 1 year ago

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