Assume X = income and Y=consumption X Y 8 7 10 6.5 12 9 14 9.5 16 11 18 11.5 20

Question

Assume X = income and Y=consumption X Y 8 7 10 6.5 12 9 14 9.5 16 11 18 11.5 20 12 22 14 24 15.5 26 10 The question is following: suppose heteroscedasticity is believed to be an issue for the consumption on income regression model. Asssume that the error variance is proporional to Xi^2 and make a suitable transformation. Estimate the parameters in the transformed model. I got tat with OLS that b2 is 0.373 and b1 is 4.26 but i dont know how to esimate the paramters in the transformed model, the answer is b1 is 0.431 and b2 is 3.326 in the transformed model. how can I resolve the issue?

Explanation / Answer

take help http://www.ats.ucla.edu/stat/r/faq/deltamethod.htm

Related Questions

Navigate

• Browse (All)
• Browse A
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.