Econometrics-Ordinary Least Squares (OLS) (ISS (Statistical Services) Statistics Paper III): Questions 1 - 5 of 5

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Question number: 1

» Econometrics » Ordinary Least Squares (OLS)

Appeared in Year: 2015

Essay Question▾

Describe in Detail

Describe in detail Indirect Least square method for estimating structural parameters. Is the estimator unbiased and/or consistent?

Explanation

For a just or exactly identified structural equation, the method of obtaining the estimates of the structural coefficients from the OLS estimates of the reduced-form coefficients is known as the method of indirect least squares (ILS), and the estimates thus obtained are known as the indirect least squares estimates. ILS

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Question number: 2

» Econometrics » Ordinary Least Squares (OLS)

Appeared in Year: 2011

Essay Question▾

Describe in Detail

If Equation is an individual’s utility function of two goods, show that the demand for the goods is Equation and Equation

WhereEquation and Equation are the fixed price and µ be the individual fixed income.

Explanation

For consumer’s equilibrium, we have

Equation

Equation and hence, we get

Equation

Equation

Equation

Equation

Equation

Equation

Equation ………………. (i)

since, µ the individual income is fixed, we have

Equation

Equation

Equation

Substituting the value of Equation in (i),

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Question number: 3

» Econometrics » Ordinary Least Squares (OLS)

Appeared in Year: 2012

Essay Question▾

Describe in Detail

Discuss the practical consequences of autocorrelation. Show that

Equation

Explanation

Practical consequences of autocorrelation:

  1. OLS estimators are still unbiased and consistent. Equation

  2. The variance of the estimators are underestimated. In the presence of autocorrelation Equation , but Equation Thus, variance of Equation may be either over estimated or under estimated depending upon the nature of the correlation.

  3. Prediction will be

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Question number: 4

» Econometrics » Ordinary Least Squares (OLS)

Appeared in Year: 2012

Short Answer Question▾

Write in Short

If the demand curve is of the form Equation , where p is the price and x is the demand, prove that the elasticity of demand is Equation · Hence deduce the elasticity of demand for Equation

Question number: 5

» Econometrics » Ordinary Least Squares (OLS)

Appeared in Year: 2012

Short Answer Question▾

Write in Short

Let the demand function be expressed asEquation . For what value of X, the elasticity of demand will be unitary?

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