Introduction to Econometrics (ECO312)
DIPET 1 in Economics - ECNT
Semester: First Semester
Level: 400
Year: 2013
UBa- HTTTC
First Semester Examination: 2013
Department of Economics: Level 3
Econometrics: Level 300
Time allowed: 2hrs
1. a) Distinguish between a statistic and a parameter.
b) List and briefly explain any
four
properties of a good estimator. (4 mks)
2. Consider the following sample information on the quantity demanded of
a commodity (Y), price of the commodity (X
1
) and income (X
2
) of a
consumer for a period of five months.
1 2 3 4 5
Demand (Y) 3 4 2 6 8
Price (X
i
) 2 4 5 6 7
income (X
2
) 4 3 2 1 1
a) Write the population stochastic and deterministic relation of the
equation. (2mks)
b) Write the estimated equation and discuss the a priori signs of the
estimators. (2 mks)
c) C) Write the normal equations for this two variate model. (2 mks)
d) Use the OLS method and matrix algebra to estimate the model ( 8 mks)
e) Determine the coefficient of determination and interpret your answer
(2 mks)
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