Consider the following model with both entity and time fixed effects: Y =b₁X₁ +8₁ +h₂ +u; i = 1,...,n, t = 1,...T, it 1 it i t where g¡ is the (entity) fixed effect for entity i, and he is the (time) fixed effect for time period t. What are the INTERCEPT and the SLOPE for a) entity 1 in time period 1 b) entity 1 in time period 2 c) entity 2 in time period 1 d) entity 2 in time period 2

Consider the following model with both entity and time fixed effects: Y =b₁X₁ +8₁ +h₂ +u; i = 1,...,n, t = 1,...T, it 1 it i t where g¡ is the (entity) fixed effect for entity i, and he is the (time) fixed effect for time period t. What are the INTERCEPT and the SLOPE for a) entity 1 in time period 1 b) entity 1 in time period 2 c) entity 2 in time period 1 d) entity 2 in time period 2

Managerial Economics: Applications, Strategies and Tactics (MindTap Course List)

14th Edition

ISBN:9781305506381

Author:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris

Publisher:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris

Chapter5: Business And Economic Forecasting

Section: Chapter Questions

Problem 7E: The Questor Corporation has experienced the following sales pattern over a 10-year period: Compute...

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As a manager of a small software retailing company, you are concerned with projected profit next year. While profit can be determined as the difference between sales and maintenance cost, or in symbols, P = S - M, where P is profit, S is sales, and M is maintenance cost including technical support. It is argues that when sales goes up so does maintenance cost because the cost of technical support will go up. Further, it is measured that the correlation between S and M is 0.8. Now given the figure that sales next year is expected to be $300 thousand with standard deviation of $4 thousand and maintenance cost is expected to be $150 thousand with standard deviation of $6 thousand, what would be the expected profit and its standard deviation you will include in your report?
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Hello. May I ask how did you get the values? Were those only assumed values? Can you also explain how did you make the normal form thoroughly?
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