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Time Series & Trend · Question 65 of 68

Question 65

HardOriginal question

Which pair of normal equations gives aa and bb in the least-squares line y=a+bxy = a + bx for nn observations?

Options for question 65

Show the answer and explanation
CorrectNot quiteAnswer D

Correct answer: D

Explanation

  1. Summing y=a+bxy = a + bx over all nn points gives ∑y=na+b∑x\sum y = na + b\sum x.

  2. Multiplying by xx first and then summing gives ∑xy=a∑x+b∑x2\sum xy = a\sum x + b\sum x^{2}.

Worth noting

The second pair writes ∑y=a+b∑x\sum y = a + b\sum x: adding aa up nn times gives nana, not aa.

Concept
The normal equations
Typical time
120 s
Your time
—
The rule this testsA straight-line trend by least squares
Practise this chapter →

Ten questions from Time Series & Trend, at your own pace.

Practise this chapter →

Ten questions from Time Series & Trend, at your own pace.