Explain the meaning of regression, Econometrics

Assignment Help:

Problem 1:

a. Explain the meaning of regression and its usefulness.

b. Distinguish between GARCH (1, 1) and asymmetric GARCH.

c. Clearly explain the two tests used for Cointegration?

d. Differentiate between a deterministic trend and a stochastic trend.

e. What is a Regime Switching Model?

Problem 2:

Consider the following regression result:

Y = 24.77 + 0.9415X1t - 0.0424X2t

Standard errors: (6.7525) (0.8229) (0.0807)

R-squared = 0.9635, R-bar squared = 0.9531 df =7

F-ratio = 92.40

Where Y denotes consumption, X1t denotes income and X2t denotes wealth

Required:

(a) Interpret the estimated regression results?

(b) With reference to your answer to (a), explain, with supporting reasons, the problem(s) with this regression?

(c) With reference to your answer in (b), explain  how you would  detect such a problem?


Related Discussions:- Explain the meaning of regression

Long-run equilibrium solution, Suppose a small open economy is characterise...

Suppose a small open economy is characterised by the following equations/information:             Y =6K 0 L 1-α             K 0 = 30,000             L 0 = 10,000

Econometric techniques analyse daily prices, Choose a share from a market s...

Choose a share from a market such as LSE, NYSE, NASDAQ, etc. [Data sources could be Datastream, Google Finance or others]. Prepare a report which involves the following aspects:

Maximising levels of capital, A perfectly competitive firm hires its machin...

A perfectly competitive firm hires its machines at a constant rental rate of r = 5 euros per unit and its workers at a constant wage rate of w = 4 euros per unit. It can also sell

Ac, what is ac that mines average cost,

what is ac that mines average cost,

Nonlinear specification and dummy variables, Suppose you have a model of ca...

Suppose you have a model of capital investment by a U.S. rm. Imagine that yt, x1t and x2t are annual measures of investment, lagged pro t, and lagged capital stock, all in real do

Calculate the percentage and test the hypothesis, Consider an equation to e...

Consider an equation to explain salaries of CEOs in terms of annual firm sales, return on equity (ROE, in percent form), and return on the firm's stock (ROS, in percent form): L

Calculate the elasticity of the premium, You are a property insurer and one...

You are a property insurer and one of your potential clients, whose current wealth is $450,000, wants to insure her $250,000 house.  The chances of the house burning down in any gi

Macro econometrics.., (b) Suppose that the initial conditions are as follow...

(b) Suppose that the initial conditions are as follows: y0 = 0 and et = 0 for t= 0. Impose the initial conditions in order to find the general solution.

Elasticity, Assume the price elasticity of cigarettes is 0.25. By how much ...

Assume the price elasticity of cigarettes is 0.25. By how much would prices have to increase to get a 20% reduction on smoking?

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd