Question

In: Statistics and Probability

Assume the following data-generating process: Yigt= α + δ2Group2g + δ3Group3g + δ4Group4g + γ2Period2t +...

Assume the following data-generating process: Yigt= α + δ2Group2g + δ3Group3g + δ4Group4g + γ2Period2t + γ3Period3t + γ4Period4t + γ5Period5t + βXgt + Uigt (LO5)

a. Interpret δ3.

b. Interpret γ4.

c. Interpret β.

d. What is the effect of moving from Group 2 to Group 4, holding all other factors constant?

Prince, Jeff. Predictive Analytics for Business Strategy (p. 256). McGraw-Hill Higher Education.

Solutions

Expert Solution

Yigt= α + δ2Group2g + δ3Group3g + δ4Group4g + γ2Period2t + γ3Period3t + γ4Period4t + γ5Period5t + βXgt + Uigt (LO5)

a. Interpret δ3.

Ans: For the factor Group, Group 1 is taking as a reference level. So, the average difference in Y between Group 1 and Group 3 is the absolute value of δ3.

b. Interpret γ4.

Ans: For the factor Period, Period 1 is taking as a reference level. So, the average difference in Y between Period 1 and Period 4 is the absolute value of γ4.

c. Interpret β.

Ans: When a unit is increased on the continuous independent variable X, increase or decrease the mean of Y by β. If the value of β is negative, the mean of Y is decreased with the absolute value of β by increasing a unit on X. And, If the value of β is positive, the mean of Y is increased with the value of β by increasing a unit on X.

d. What is the effect of moving from Group 2 to Group 4, holding all other factors constant? Prince, Jeff. Predictive Analytics for Business Strategy (p. 256). McGraw-Hill Higher Education.

Ans: The effect of moving from Group 2 to Group 4, holding all other factors constant is that the average of response variable Y changes with the absolute value of (δ2-δ4) from Group 2 to Group 4. So, the mean of Y may be reduced or increased when change Group 2 to Group 4.

orchestra answered 2 years ago
Next > < Previous

Related Solutions

If the true data generating process is normal, how will the bin widths of Scott's rule...
If the true data generating process is normal, how will the bin widths of Scott's rule and Freedman-Diaconis compare?
A researcher is interested in performing an explanatory variable exclusion test on 3 parameters. The data-generating-process...
A researcher is interested in performing an explanatory variable exclusion test on 3 parameters. The data-generating-process satisfies the assumptions of the Classical Linear Model. There are J=6 total explanatory variables and 42 observations. The unrestricted model is of the form: LaTeX: y_i=\beta_0+\sum_{j=1}^J\beta_jx_{ij}+u_i y i = β 0 + ∑ j = 1 J β j x i j + u i Identify the critical value from the Snedecor F-distribution with a 5% level of significance for the exclusion test suggested...
Determine the seventh projection of the following process variable data: Using Exponential Smoothing (α= 2/n+1) Actual...
Determine the seventh projection of the following process variable data: Using Exponential Smoothing (α= 2/n+1) Actual Results 100 123 140 110 150 105
Assume that the following market model adequately describes the return generating behavior of risky assets:   ...
Assume that the following market model adequately describes the return generating behavior of risky assets:    Rit=αi+βiRMt+ϵitRit=αi⁢+βiRMt+ϵit    Here:    Rit = The return on the ith asset at Time t. RMt = The return on a portfolio containing all risky assets in some proportion at Time t. RMt and ϵitϵit are statistically independent.    Short selling (i.e., negative positions) is allowed in the market. You are given the following information:      Asset βi E(Ri ) Var(€i)   A .65 7.91...
The following data are from a completely randomized design. In the following calculations, use α =...
The following data are from a completely randomized design. In the following calculations, use α = 0.05 (level of significance) Treatment 1 Treatment 2 Treatment 3 63 82 69 47 72 54 54 88 61 40 66 48 sample mean 51 77 58 sample variance 96.67 97.34 81.99 a. Use analysis of variance to test for a significant difference among the means of the three treatments. b. Use Fisher’s LSD procedure to determine which means are different.
The following data are from a completely randomized design. In the following calculations, use α =...
The following data are from a completely randomized design. In the following calculations, use α = 0.05. Treatment 1 Treatment 2 Treatment 3 64 81 68 48 71 55 53 88 60 43 64 49 xj 52 76 58 sj2 80.67 112.67 64.67 (a)Use analysis of variance to test for a significant difference among the means of the three treatments. State the null and alternative hypotheses. H0: At least two of the population means are equal. Ha: At least two...
The following data are from a completely randomized design. In the following calculations, use α =...
The following data are from a completely randomized design. In the following calculations, use α = 0.05. Treatment 1 Treatment 2 Treatment 3 62 83 68 46 71 55 53 88 62 39 70 47 xj 50 78 58 sj2 96.67 79.33 82.00 (a) Use analysis of variance to test for a significant difference among the means of the three treatments. State the null and alternative hypotheses. H0: At least two of the population means are equal. Ha: At least...
The following data are from a completely randomized design. In the following calculations, use α =...
The following data are from a completely randomized design. In the following calculations, use α = 0.05. Treatment 1 Treatment 2 Treatment 3 64 82 69 48 73 53 55 89 61 37 68 45 xj 51 78 57 sj2 130.00 87.33 106.67 Find the value of the test statistic. (Round your answer to two decimal places.)___ Find the p-value. (Round your answer to three decimal places.) p-value = ____ +Use Fisher's LSD procedure to determine which means are different....
The following data are from a completely randomized design. In the following calculations, use α =...
The following data are from a completely randomized design. In the following calculations, use α = 0.05. Treatment 1 Treatment 2 Treatment 3 63 82 69 46 72 54 53 87 62 46 63 47 xj 52 76 58 sj2 64.67 114.00 91.33 (a) Use analysis of variance to test for a significant difference among the means of the three treatments. State the null and alternative hypotheses. H0: μ1 = μ2 = μ3 Ha: Not all the population means are...
The following data are from a completely randomized design. In the following calculations, use α =...
The following data are from a completely randomized design. In the following calculations, use α = 0.05. Treatment 1 Treatment 2 Treatment 3 62 82 69 46 73 53 53 89 61 39 60 45 xj 50 76 57 sj2 96.67 156.67 106.67 (a) Use analysis of variance to test for a significant difference among the means of the three treatments. State the null and alternative hypotheses. H0: μ1 ≠ μ2 ≠ μ3 Ha: μ1 = μ2 = μ3 H0:...
ADVERTISEMENT
Subjects
ADVERTISEMENT
Latest Questions
ADVERTISEMENT