2. Muhvidin, Mahathir, Najib and Anwar have obtained the following data for their econometric group assignment. They wanted to study on the implications of tourism receipt on the national income for Malaysia. They used GDP growth as dependent variables, tourism receipt (TR), exchange rate (ER) and inflation (INF) as independent variables. They model used in the study are GDP, = Bo + Bi In TR; + BER; + BaINF; Table below shows the data for the estimation. Tourism Receipts Exchange Rate (USS) 5,044,000,000 5,732,000,000 4,925,000,000 3,237,000,000 4,403,000,000 5,873,000,000 7,627,000,000 ৪,084,000,000 6,799.000,000 9,183,000,000 10,389,000,000 12,280,000,000 17,948,000,000 18,553,000,000 17,231,000,000 19,619,000,000 21,338,000,000 21,711,000,000 23,283,000,000 24,469,000,000 19,194,000,000 19,682,000,000 20,311,000,000 21,775,000,000 22,199,000,000 GDP Growth Inflation Year 1995 1996 1997 1998 6) 9.8291 10.0027 7.3227 RM per USS) 2.5073 2.5154 2.8173 3.9254 3.8000 3.8000 3.4506 3.4886 2.6625 5.2703 -7.3594 6.1376 8.8589 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2.7446 1.5347 1.4168 1.8079 1.0897 1.4213 2.9751 3.6092 0.5177 5.3910 5.7885 3.8000 3.8000 3.8000 3.8000 3.7869 3.6661 6.7834 5.3321 5.5848 6.2988 4.8318 -1.5135 7.4248 5.2939 5.4735 4.6937 6.0067 5.0915 4.4498 5.8127 4.8431 3.4354 33292 3.5231 3.2175 3.0564 3.0862 3.1488 3.2697 3.9041 4.1372 2.0274 5.4408 0.5833 1.6229 3.1745 1.6636 2.1050 3.1430 2.1044 2.0906 3.8712 0.8847 0.6629 2017 2018 2019 4.2982 4.0307 4.1416 4.4395 a Regress the equation, and interpret the coefficients for all regressors. b. Obtain the VIF values for each yariables and conclude whether multicollinearity problem exist in the model? c. If we assume that the multicollinearity problem exists in the estimation, what are the

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2. Mukvidin, Mahathir, Najib and Anwar have obtained the following data for their econometric
group assignment. They wanted to study on the implications of tourism receipt on the national
income for Malaysia. They used GDP growth as dependent variables, tourism receipt (TR),
exchange rate (ER) and inflation (INF) as independent variables. They model used in the study
are GDP; = Bo + B1 In TR; + B2ER; + BaINF, Table below shows the data for the estimation.
GDP Growth
Tourism Receipts Exchange Rate
(USS)
5,044,000,000
5,732,000,000
4,925,000,000
3,237,000,000
4,403,000,000
5,873,000,000
7,627,000,000
৪,084,000,000
6,799,000,000
9,183,000,000
10,389,000,000
12,280,000,000
17,948,000,000
18,553,000,000
17,231,000,000
19,619,000,000
21,338,000,000
21,711,000,000
23,283,000,000
24,469,000,000
19,194,000,000
19,682,000,000
20,311,000,000
21,775,000,000
22,199,000,000
Inflation
Year
1995
1996
1997
(RM per USS)
2.5073
2.5154
9.8291
10.0027
3.4506
3.4886
2.6625
5,2703
2.7446
1.5347
1.4168
1.8079
1.0897
1.4213
2.9751
7.3227
-7.3594
6.1376
2.8173
3.9254
3.8000
3.8000
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
8.8589
0.5177
5.3910
5.7885
3.8000
3.8000
3.8000
3.8000
3.7869
3.6661
6.7834
5.3321
5.5848
3.6092
6.2988
4.8318
-1.5135
7.4248
5.2939
5.4735
4.6937
3.4354
3.3292
3.5231
3.2175
3.0564
3.0862
3.1488
3.2697
2.0274
5.4408
0.5833
1.6229
3.1745
1.6636
2.1050
2011
2012
2013
2014
2015
2016
6.0067
5.0915
3.1430
2.1044
2.0906
3.8712
0.8847
0.6629
3.9041
4.1372
2017
2018
2019
4.4498
5.8127
4.8431
4.4395
4.2982
4.0307
4.1416
a Regress the equation, and interpret the coefficients for all regressors.
b. Obtain the VIF values for each yariables and conclude whether multicollinearity problem
exist in the model?
c. If we assume that the multicollinearity problem exists in the estimation, what are the
remedial measures?
Transcribed Image Text:2. Mukvidin, Mahathir, Najib and Anwar have obtained the following data for their econometric group assignment. They wanted to study on the implications of tourism receipt on the national income for Malaysia. They used GDP growth as dependent variables, tourism receipt (TR), exchange rate (ER) and inflation (INF) as independent variables. They model used in the study are GDP; = Bo + B1 In TR; + B2ER; + BaINF, Table below shows the data for the estimation. GDP Growth Tourism Receipts Exchange Rate (USS) 5,044,000,000 5,732,000,000 4,925,000,000 3,237,000,000 4,403,000,000 5,873,000,000 7,627,000,000 ৪,084,000,000 6,799,000,000 9,183,000,000 10,389,000,000 12,280,000,000 17,948,000,000 18,553,000,000 17,231,000,000 19,619,000,000 21,338,000,000 21,711,000,000 23,283,000,000 24,469,000,000 19,194,000,000 19,682,000,000 20,311,000,000 21,775,000,000 22,199,000,000 Inflation Year 1995 1996 1997 (RM per USS) 2.5073 2.5154 9.8291 10.0027 3.4506 3.4886 2.6625 5,2703 2.7446 1.5347 1.4168 1.8079 1.0897 1.4213 2.9751 7.3227 -7.3594 6.1376 2.8173 3.9254 3.8000 3.8000 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 8.8589 0.5177 5.3910 5.7885 3.8000 3.8000 3.8000 3.8000 3.7869 3.6661 6.7834 5.3321 5.5848 3.6092 6.2988 4.8318 -1.5135 7.4248 5.2939 5.4735 4.6937 3.4354 3.3292 3.5231 3.2175 3.0564 3.0862 3.1488 3.2697 2.0274 5.4408 0.5833 1.6229 3.1745 1.6636 2.1050 2011 2012 2013 2014 2015 2016 6.0067 5.0915 3.1430 2.1044 2.0906 3.8712 0.8847 0.6629 3.9041 4.1372 2017 2018 2019 4.4498 5.8127 4.8431 4.4395 4.2982 4.0307 4.1416 a Regress the equation, and interpret the coefficients for all regressors. b. Obtain the VIF values for each yariables and conclude whether multicollinearity problem exist in the model? c. If we assume that the multicollinearity problem exists in the estimation, what are the remedial measures?
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