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You are estimating the effect of temperature on ice cream sales using a bivariate OLS regression. You use the estimating equation Sales =B+B₁₂ temperature, + & where i is the recorded day (from i=1 for july 1st to i 0 1 i i=31 for july 31st), temperature is the temperature in Farenheit, and Sales is the total ice cream sales in Chicago in thousands of dollars for that day. You estimate that =10, ß₁=6. 0 You are concerned that is biased since there was a festival that occured during the hottest part of the month, 1 and festivals impact ice cream sales but are not modeled and hence in the error term. You recall that 6 E[B₂] =B₁+cor (x,x) 1 6 E X . You estimate that What is th expected true value of ß? 1 6 6 E X =5 and that cor(x,x) = 0.5

You are estimating the effect of temperature on ice cream sales using a bivariate OLS regression. You use the estimating equation Sales =B+B₁₂ temperature, + & where i is the recorded day (from i=1 for july 1st to i 0 1 i i=31 for july 31st), temperature is the temperature in Farenheit, and Sales is the total ice cream sales in Chicago in thousands of dollars for that day. You estimate that =10, ß₁=6. 0 You are concerned that is biased since there was a festival that occured during the hottest part of the month, 1 and festivals impact ice cream sales but are not modeled and hence in the error term. You recall that 6 E[B₂] =B₁+cor (x,x) 1 6 E X . You estimate that What is th expected true value of ß? 1 6 6 E X =5 and that cor(x,x) = 0.5

MATLAB: An Introduction with Applications
MATLAB: An Introduction with Applications
6th Edition
ISBN:9781119256830
Author:Amos Gilat
Publisher:Amos Gilat
Chapter1: Starting With Matlab
Section: Chapter Questions
Problem 1P
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You are estimating the effect of temperature on ice cream sales using a bivariate OLS regression. You use the estimating equation Sales =B+B temperature, + & where i is the recorded day (from i=1 for july 1st to i i 1 i=31 for july 31st), temperature is the temperature in Farenheit, and Sales is the total ice cream sales in Chicago in thousands of dollars for that day. You estimate that = 10, ₁ 0 1 You are concerned that is biased since there was a festival that occured during the hottest part of the month, and festivals impact ice cream sales but are not modeled and hence in the error term. You recall that 6 E[B₂] =B₁ E = 6. 6 X + cor(x,x) You estimate that = 5 and that cor (x,x) = 0.5 б What is th expected true value of ₁? 1 E 6 X
Transcribed Image Text:You are estimating the effect of temperature on ice cream sales using a bivariate OLS regression. You use the estimating equation Sales =B+B temperature, + & where i is the recorded day (from i=1 for july 1st to i i 1 i=31 for july 31st), temperature is the temperature in Farenheit, and Sales is the total ice cream sales in Chicago in thousands of dollars for that day. You estimate that = 10, ₁ 0 1 You are concerned that is biased since there was a festival that occured during the hottest part of the month, and festivals impact ice cream sales but are not modeled and hence in the error term. You recall that 6 E[B₂] =B₁ E = 6. 6 X + cor(x,x) You estimate that = 5 and that cor (x,x) = 0.5 б What is th expected true value of ₁? 1 E 6 X
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