Essay
Consider the following multiple regression model
Yi = ?0 + ?1X1i + ?2X2i + ?3X3i + ui
You want to consider certain hypotheses involving more than one parameter, and you know that the regression error is homoskedastic. You decide to test the joint hypotheses using the homoskedasticity-only F-statistics. For each of the cases below specify a restricted model and indicate how you would compute the F-statistic to test for the validity of the restrictions.
(a)?1 = -?2; ?3 = 0
(b)?1 + ?2 + ?3 = 1
(c)?1 = ?2; ?3 = 0
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(a)The restricted model is Yi = ?0 + ?2 (X2i ...View Answer
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