State the ordinary least squares (OLS) estimation criterion. State the OLS normal equations. Derive the...

State the ordinary least squares (OLS) estimation criterion. State the OLS normal equations.

Derive the OLS normal equations from the OLS estimation criterion.

Perform a test of the null hypothesis H₀:β2 = 0 against the alternative hypothesis H₁:β2 ≠ 0 at the 1% significance level ( i.e. for significance level α = 0.01 ). Show how you calculated the test statistic. State the decision rule you use, and the inference you would draw from the test. Briefly explain what the test outcome means.

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Rahul Sunny answered 1 year ago

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