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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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