Choice the correct answer please and explain why 1) In a linear regression equit

Question

Choice the correct answer please and explain why

1) In a linear regression equitation of the form ln Yi = 0 +1lnLab1i+2Capi+ui (where Lab is labor input and Cap is capital input) the slope parameter 1 shows

a. Y/Lab

b. the percentage change in Y for a 1 percentage change in Lab

c. the elasticity of Y with respect to Lab

d. the elasticity of Lab with respect to Y

e. Lab/Y

2. In a linear regression equation of the form Y = + X + u, the intercept parameter shows

a. the amount that Y changes when X changes by one unit

b. the amount that X changes when Y changes by one unit

c. the value of Y when X is zero

d. the value of X when Y is zero

3. In a linear regression equitation of the form Y = Xeu, the slope parameter shows

a. Y/X

b. the percentage change in Y for a 1 percentage change in X

c. the elasticity of Y with respect to X

d. the elasticity of X with respect to Y

e. X/Y

4. To test the null hypothesis that the value of a particular regression parameter is zero, one uses ____

a. the F-statistic.

b. the t-statistic

c. R2-statistic

d. the standard error statistic

5. To test whether the overall regression model is significant, one uses ____

a. the F-statistic.

b. the t-statistic

c. R2-statistic

d. the standard error statistic

5. To test whether the overall regression model is significant, one uses a. the F-statistic b. the t-statistic c. R2-statistic d. the standard error statistic Given the OLS estimates of the CAPM stochastic regression model, UTXR--BSSP500, u, UTXR is the monthly return on United Technologies Corporation (UTX) stock, S&P500; is the monthly return on the S&P500; market index and u is the error term; Dependent Variable: RUTX Method: Least Squares Date: 11/05/16Time: 11:59 Sample (adjusted): 1993M12 1999MO3 Included observations: 64 after adjustments Variable Coefficient Std. Error t-StatisticProb 0.006564 0.0056651158552 0.2511 1.231945 0.122017 10.09653 0.0000 RINDEX R-squared 0.621813 Mean dependent var 0.028365 Adjusted R-squared0.615713 S.D. dependent var 0.067595 S.E. of regression0.041903 Akaike info criterion -3.476173 3.408708 3.449595 101.9399Durbin-Watson stat 2.018383 Sum squared resid0.108863 Schwarz criterion Log likelihood 113.2375 Hannan-Quinn criter.I Prob(F-statistic) 0.000000

Explanation / Answer

Solution:-

1) option b. the percentage change in Y for a 1 percentage change in Lab

=>  In a linear regression equitation of the form ln Yi = 0 +1lnLab1i+2Capi+ui (where Lab is labor input and Cap is capital input) the slope parameter 1 shows the percentage change in Y for a 1 percentage change in Lab.

2) option c. the value of Y when X is zero

3) option  a. Y/X

4)  b. the t-statistic

=> To test the null hypothesis that the value of a particular regression parameter is zero, one uses the t-statistic.

5) option a. the F-statistic.

=> To test whether the overall regression model is significant, one uses the F-statistic.

=

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