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    • Question

      Suppose the regression specification y(hat) = a + βx

      + l  z + ε was estimated as y = 5 + 6x + 7z. We have a new observation for which x = 5 and z = -2. For this new observation the associated value of true y is
      A 21 Correct Answer Incorrect Answer
      B 35 Correct Answer Incorrect Answer
      C 16 Correct Answer Incorrect Answer
      D Cannot be determined Correct Answer Incorrect Answer

      Solution

      ŷ is related to sample. We can only estimate ŷ and cannot calculate its true value.

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