Discuss the properties of this estimator

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Reference no: EM131132467

An investigator correctly believes that the relationship between two variables X and Y is given by

Yi = β1 + β₂Xi + ui,

Given a sample of n observations, the investigator estimates β₂ by calculating it as the average value of Y divided by the average value of X. Discuss the properties of this estimator. What difference would it make if it could be assumed that β₁ is equal to 0?

Reference no: EM131132467

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