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2.1) What are two basic estimator properties defining them as “high quality“ estimators?

2.2) List 3 basic assumptions providing high quality of the OLS estimators. Provide both wording and mathematical formulation.

2.3) How enlargement of the spread of Xi would affect the variance of β1 ? Explain.

2.4) How enlargement of the spread of error terms would affect the variance of β1? Explain.

Expert Answer

2.1) What are two basic estimator properties defining them as “high quality“ estimators? 2.2) List 3 basic assumptions providing high quality of the OLS estimators. Provide both wording and mathematical formulation. 2.3)

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