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Write three econometric models capturing 1) overall; 2) within; and 3) between variation
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- Review the logic of spuriousness. Can you think up an example where an observed relationship between two variables could actually be explained away by a third variable?Explain in detail bias, variance, and the trade-off between them. Feel free to illustrate your understanding, but you must EXPLAIN your understanding in text.Using 5% significance as the guide, interpret the pair-wise Granger causality.
- Scenario B: The nonprofit recently engaged in a campaign to encourage elementary school children to read more. A previous study found that children in your community read in their free time for 48 minutes per day on average. You would like to find out whether the time spent reading among elementary school students increased after the campaign.Define conversation analysis (CA)An increase in meat prices coincides with an increase in rainfall is an associative relationship the statement above is true/false?
- what is correlation cofficientYou and your research partner want to use Instrumental Variable analysis to write an econometrics paper and find causal estimates. Your partner argues that because the residuals and the instrument are uncorrelated, the exogeneity requirement is satisfied. What do you tell your research partner: a) You agree, the exogeneity requirement is satisfied by construction b) You agree, the exogeneity requirement is satisfied by their demonstration c) You disagree, you would need the results of the White Test to make this conclusion d) You disagree, the exogeneity requirement cannot be tested as we do not observe the error terms e) You cannot make any conclusions with the current informationlook at the influence of mileage on the sale price of each brand ofautomobile. Postulate the following statistical models,?_ℎ????? = ?0 + ?1?????? + ?? and ?_?ℎ??? = ?0 + ?1?????? + ?? with ??~?(0, ?2).For each model (‘model_honda’ and ‘model_chev’) perform the following,Comment on the miles variable after examining it with hist() and summary() commands.What does the assumption of non-random independent variable imply about how thedata must be collected if the same miles variable is used for both brand of automobile?