Chapter 2

A dependent variable is also known as a(n) _____.

• explanatory variable

• control variable

• predictor variable

• response variable

If a change in variable x causes a change in variable y, variable x is called the _____.

• dependent variable

• explained variable

• explanatory variable

• response variable

In the equation y = β0 + β1 x + u, β0 is the _____.

• dependent variable

• independent variable

• slope parameter

• intercept parameter

In the equation y = β0 + β1 x + u, what is the estimated value of β0 ? (note: Babi oi cau nay trong testbank bi loi y)

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In the equation c = β0 + β1 i + u, c denotes consumption and i denotes income. What is the residual for the 5th observation if c5 =$500 and c^ 5 =$475?

• $975

• $300

• $25

• $50

What does the equation ^y=^ β0+ ^ β1 x denote if the regression equation is y = β0 + β1x1 + u?

• The explained sum of squares

• The total sum of squares

• The sample regression function

• The population regression function

Consider the following regression model: y = β0 + β1x1 + u. Which of the following is a property of Ordinary Least Square (OLS) estimates of this model and their associated statistics?

• The sum, and therefore the sample average of the OLS residuals, is positive.

• The sum of the OLS residuals is negative.

• The sample covariance between the regressors and the OLS residuals is positive.

• The point ( ´x , ´y ) always lies on the OLS regression line.

The explained sum of squares for the regression function, yi=β0+β1 x1+u1 , is defined as _____.

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If the total sum of squares (SST) in a regression equation is 81, and the residual sum of squares (SSR) is 25, what is the explained sum of squares (SSE)?

• 64

• 56

• 32

• 18

If the residual sum of squares (SSR) in a regression analysis is 66 and the total sum of squares (SST) is equal to 90, what is the value of the coefficient of determination?

• 0.73

• 0.55

• 0.27

• 1.2