Dependent Variable: WHY
Method: Least Squares
Sample(adjusted): 19652006
Included Observations

Essay

Dependent Variable: WHY
Method: Least Squares
Sample(adjusted): 19652006
Included observations: 30 atter adjusting endpoints

$\begin{array}{lllll}\hline \text { Variable } & \text { Coefficient } & \text { Std. Error } & \text { t-Statistic } & \text { Prob. } \\\hline \hline \text { C } & -19.60486 & 123.5064 & -0.158736 & 0.8747 \\\text { EX1 } & 20.04112 & 12.56987 & 1.594377 & 0.1189 \\\text { EX2 } & 0.517140 & 0.007738 & 66.83540 & 0.0000 \\\hline \text { R-squared } & 0.991948 &\text { Mean dependent var } && 2775.633 \\\text { Adjusted R-squared } & 0.991536 & \text { S.D. dependent var } && 1915.813 \\\text { S.E. of regression } & 176.2591 & \text { Akaike info criterion }&& 13.25054 \\\text { Sum squared resid } & 1211624 . & \text { Schwarz criterion } && 13.37466 \\\text { Log likelihood } & -275.2613 & \text { F-statistic }&& 2402.403 \\\text { Durbin-Watson stat } & 0.289425 &\text { Prob(F-statistic) } && 0.000000\end{array}$ Use the Eviews output above to help with A) through I) below.
A) Interpret the coefficient on EX1.
B) Interpret R² for this regression.
C) Replace the "?"'s with the appropriate values. An 80% confidence interval around the coefficient on EX1 is: 20.04112 +/- (?)(?)
D) Perform a positive sign test on the coefficient attached to EX2. Show the 5-step procedure.
E) IF you performed a test of significance on the constant term at the 87 percent critical level, would you reject the null hypothesis or not? Explain.
F) Perform a test to determine if the coefficient attached to EX2 is greater than 7.47. Show the 5-step procedure.
G) Based on the information in the table above (and ignoring Ramsey's Reset test which we will perform in a moment) do you think the regression above is under or over specified? Explain.
H)1.Perform Ramsey's Reset Test on the regression above using the Eviews printout below. Show the 5-step procedure.
2. What is the difference between "FITTED^2" and "FITTED^3" in the Eviews printout above? Do the two terms appear in the restricted or unrestricted regression?