7. Consider the following model: y = B, + B,x +° . In this model, the following is true: a) there is a deterministic component and a random component in the model equation b) the error term in the model represents cumulative mistakes made by the researcher in computing his/her statistics on the sample c) the intercept value is necessarily equal to 0 for any sample on which this equation is applied (as evidenced by the fact that it is indicated by the subscript 0)

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7. Consider the following model: y= Po + B,x +€ . In this model, the
following is true:
a) there is a deterministic component and a random component
in the model equation
b) the error term in the model represents cumulative mistakes
made by the researcher in computing his/her statistics on the
sample
c) the intercept value is necessarily equal to 0 for any sample on
which this equation is applied (as evidenced by the fact that it is
indicated by the subscript 0)
d) when computed on a sample, the slope must always be
positive for this equation to work
e) if we were to use this equation for prediction, we'd place
“hats" above certain values in the equation
f) a and e
g) a, b and e
Transcribed Image Text:7. Consider the following model: y= Po + B,x +€ . In this model, the following is true: a) there is a deterministic component and a random component in the model equation b) the error term in the model represents cumulative mistakes made by the researcher in computing his/her statistics on the sample c) the intercept value is necessarily equal to 0 for any sample on which this equation is applied (as evidenced by the fact that it is indicated by the subscript 0) d) when computed on a sample, the slope must always be positive for this equation to work e) if we were to use this equation for prediction, we'd place “hats" above certain values in the equation f) a and e g) a, b and e
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