question archive 02 3) Consider the following formula: Var(B,) = SST (1 - R; ) (5 points) a) Explain what each term: Var(B;) , o' , SST, and R, means; formulas are optional if your explanation is good
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02 3) Consider the following formula: Var(B,) = SST (1 - R; ) (5 points) a) Explain what each term: Var(B;) , o' , SST, and R, means; formulas are optional if your explanation is good. b) What is the difference (in words, not equations) between o and o c) Suppose the variable x; is highly correlated with many of the other variables in the regression. Which term on the right hand side of the equation will this affect, and what will be the effect on the Var(B) ?
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Step-by-step explanation
Van (3 ) - amoriated wwith job independent valuable " ) 1 4 is population variance Joe it measures few for observed values differ from the average of predicted value .) SSTis Also called as sum of equation total and it is solemn Hair mean , anociated with it variable SST = R Anna, relied on coefficient of determination. in the estimatah of which in population valance
() . Higher the carrelation, greater In the value 70 9 R, increases, then ( 1- Ri ) decrease , therefore
van ( B)