ECO327Y5 Study Guide - Midterm Guide: Ceteris Paribus
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6. 2 by definition of the ols regression of c0yi on c1xi1, [we obtain these from equations (3. 13), where we plug in the scaled dependent and independent variables. ] Plugging in these guesses for the gives the expressions for j = 1,2, ,k. Simple cancellation shows we can write these equations as and or, factoring out constants, and j 00111111001111001111[()()()]0()[()()()]0()[()()()]0. niikkikiniiikkikinkikiikkikicycxcxcxcycxcxcxcycxcx 0 00 c j 0(/)jjcc j 00001111010000111101 [()(/)()(/)()] ()[()(/)()(/)()],niikkkikinjijiikkkikicyccccxcccxcxcyccccxcccx 00001101 [()]niikikicyccxcx 00001101 ()[()],1,2,,njijiikikicxcyccxcxjk 00111 ()niikikicyxx , j = 1, 2, But the terms multiplying c0 and c0cj are identically zero by the first order conditions for the since, by definition, they are obtained from the regression yi on xi1, , xik, i = 1,2,,n. so we have shown that. , k solve the requisite first order conditions. 6. 3 (i) the turnaround point is given by. 21,428. 57; remember, this is sales in millions of dollars. alternative h0: < 0 at the 5% level (cv (ii) probably.
