6.Suppose that a researcher estimates a consumptions function and obtains the following results: where The number in parenthesis is t _value; C=Consumption, Yd=disposable income, and numbers in the parenthesis are the ‘t-ratios’ a.Test the significant of Yd statistically using t-ratios b.Determine the estimated standard deviations of the parameter estimates 7.State the assumption of OLS model 8.Given the model: with usual OLS assumptions. Show the expression for the error variance.

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6.Suppose that a researcher estimates a consumptions function and obtains the following results:

where

The number in parenthesis is t _value;

C=Consumption,

Yd=disposable income, and numbers in the parenthesis are the ‘t-ratios’

a.Test the significant of Yd statistically using t-ratios

b.Determine the estimated standard deviations of the parameter estimates

7.State the assumption of OLS model

8.Given the model:

with usual OLS assumptions. Show the expression for the error variance.

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