1. Would you please open your net and find PENN WORLD TABLE or IMF Statistics or World Bank Economic Indicators etc.Find the data from these documentsas required by you. Copy the Data. These have most of the economic variables for all the countries, for example GDP, Expenditures, Exchange rate and price structure, etc. It also has a number of other economic variables, some of which are very common. Select a dependent variables and four independent variables from the data which follows the economic or financial theory which you suggested for your estimation. Would you please also keep in front of you that Y is dependent variable and X1, X2, X3, X4, and X5. a. Consider the regression: Y = B0 + B1 X1 + B2 X2+ B3 X3 n + B4 X4+ U Interpret all the coefficient based on the theory which you selected. b. How it is possible to compare the coefficients. It is suggested that convert into standardizedcoefficients. How you will interpret these results? If your coefficients are standardized then what are your results. How you will interpret these results? c. Estimate the regression: lnY = B0 + B1 lnX1 . Interpret the coefficient B1. d. Compare the regressions in a and b. Which one is better? How can you tell? e. For use of comparison, begin by estimating the regression Y = B0 + B1X1 + B2X2+ U f. By running another regression, what will happen to the researcher’s estimate of B0 and B1 when X2 is omitted? By omitting X2, what will happen to your estimate of the standard error of the regression and the standard errors of the slope and intercept? c. Now, imagine that the researcher cannot observe X1 and instead estimates the regression: Y = B0 + B2X2 + U What are your estimates of B0 and B2? Create two 95% confidence intervals to see if these estimates could possibly equal the population parameters used to generate the y variable. d. Imagine a researcher performed the following regression without X4: Y = B0 + B1X1 + B2X2 + B3X3 + U. What is the theoretical impact on this researcher’s estimates of B1 and B2? What should the estimate of B3 equal in this regression? What should happen to the researchers estimate of the standard errors of B1and B2 and the standard error of the regression? NOTE: In all the regressions, interpret coefficients, R2, t-statistics, F-Statistics, level of significance and all the relevant interpretations. USE ANY PACKAGE OF STATISTICS, FOR EXAMPLE SPSS OR EVIEWS OR ANY OTHER. ALSO SUBMIT YOUR DATA WITH YOUR ASSIGNMENT.
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