ECS3706/ASSIGNMENT 1/2024
Assignment 01 Semester 02
Econometrics
ECS3706
Semester 2
Department of Economics
This tutorial letter contains Assignment 1 Questions
Unique Number: 157508
BARCODE
, 1 Which of the following statements about the residual in the context of regression analysis
is/are correct?
a It is the slope of the regression equation
b It is the correlation coefficient
c It is the difference between the observed and predicted values of the dependent
variable
[1] a
[2] a and b
[3] a, b and c
[4] c
2 Which of the following indicates a good fit of the model in multiple regression analysis?
a A high standard error of the estimate
b A high R2 value
c A small sample size
[1] b
[2] a and b
[3] c
[4] a
Questions 3 - 10 require you to estimate regression function 1 using the Ordinary Least Squares
(OLS) method.
𝐺𝐷𝑃𝑡 = 𝛽0 + 𝛽1 𝐹𝐷𝐼𝑡 ………………………… (Equation 1)
Questions 11 – 13 require you to estimate the regression function 2.
𝐺𝐷𝑃𝑡 = 𝛽0 + 𝛽1 𝐹𝐷𝐼𝑡 + 𝛽2 𝐶𝑂2𝑡 …………….. (Equation 2).
Where: GDP: Gross Domestic Product (constant 2015 USD)
FDI: Foreign Direct Investment (net inflows % of GDP in billions of rand)
CO2: Carbon Dioxide Emissions (Kilo tons (Kt))
The data obtained from the World Bank Development Indicators (WDI) for the period 1990 -
2020 is provided in the Excel spreadsheet under the Additional Resources Folder on MyUnisa.
• Derive your answers from basic principles using MS Excel to compile a table similar to
Table 2.1: The calculation of estimated regression coefficients for the Weight/Height
example). See Studenmund, p58 in the seventh edition.
• Use a spreadsheet to perform the calculations. Please be completely accurate (no
rounding) in all calculations since rounding may significantly affect your results.
• Small letters refer to deviations from the means, as in 𝑥 = 𝑋 − 𝑋̅ and 𝑦 = 𝑌 − 𝑌̅.
2
Assignment 01 Semester 02
Econometrics
ECS3706
Semester 2
Department of Economics
This tutorial letter contains Assignment 1 Questions
Unique Number: 157508
BARCODE
, 1 Which of the following statements about the residual in the context of regression analysis
is/are correct?
a It is the slope of the regression equation
b It is the correlation coefficient
c It is the difference between the observed and predicted values of the dependent
variable
[1] a
[2] a and b
[3] a, b and c
[4] c
2 Which of the following indicates a good fit of the model in multiple regression analysis?
a A high standard error of the estimate
b A high R2 value
c A small sample size
[1] b
[2] a and b
[3] c
[4] a
Questions 3 - 10 require you to estimate regression function 1 using the Ordinary Least Squares
(OLS) method.
𝐺𝐷𝑃𝑡 = 𝛽0 + 𝛽1 𝐹𝐷𝐼𝑡 ………………………… (Equation 1)
Questions 11 – 13 require you to estimate the regression function 2.
𝐺𝐷𝑃𝑡 = 𝛽0 + 𝛽1 𝐹𝐷𝐼𝑡 + 𝛽2 𝐶𝑂2𝑡 …………….. (Equation 2).
Where: GDP: Gross Domestic Product (constant 2015 USD)
FDI: Foreign Direct Investment (net inflows % of GDP in billions of rand)
CO2: Carbon Dioxide Emissions (Kilo tons (Kt))
The data obtained from the World Bank Development Indicators (WDI) for the period 1990 -
2020 is provided in the Excel spreadsheet under the Additional Resources Folder on MyUnisa.
• Derive your answers from basic principles using MS Excel to compile a table similar to
Table 2.1: The calculation of estimated regression coefficients for the Weight/Height
example). See Studenmund, p58 in the seventh edition.
• Use a spreadsheet to perform the calculations. Please be completely accurate (no
rounding) in all calculations since rounding may significantly affect your results.
• Small letters refer to deviations from the means, as in 𝑥 = 𝑋 − 𝑋̅ and 𝑦 = 𝑌 − 𝑌̅.
2
