Econometric, on type 1 and type two error.. got the answer but i do not understand?

Posted on 2014-04-16 12:59:00 in Economics by JEFFERSON YAP

I got the answer to the following question , but i do not understand how they arrived on the answer . can anyone help explain ?



You estimate a simple linear regression model using a sample of 62 observations and obtain the

following results (estimated standard errors in parentheses below coefficient estimates):

y = 97.25 + 33.74* x

(3.86) (9.42)

You want to test the following hypothesis: H0: B2 = 12, H1: B2 ?12. If you choose to reject the null

hypothesis based on these results, what is the probability you have committed a Type I error?

a.) between .05 and .10

b.) between .01 and .025

c.) between .02 and .05

d.) It is impossible to determine without knowing the true value of B2

Ans: c



You estimate a simple linear regression model using a sample of 62 observations and obtain the

following results (estimated standard errors in parentheses below coefficient estimates):

y = 97.25 + 33.74* x

(3.86) (9.42)

You want to test the following hypothesis: H0: B2 = 12, H1: B2 ?12. If you choose to reject the null

hypothesis based on these results, what is the probability you have committed a Type II error?

a.) between .05 and .10

b.) between .01 and .025

c.) between .02 and .05

d.) It is impossible to determine without knowing the true value of B2

Ans: d





5. You estimate a simple linear regression model using a sample of 25 observations and obtain the

following results (estimated standard errors in parentheses below coefficient estimates):

y = 97.25 + 19.74 *x

(3.86) (3.42)

You want to test the following hypothesis: H0: B2 = 1, H1: B2>12. If you choose to reject the null

hypothesis based on these results, what is the probability you have committed a Type I error?

a.)between .01 and .02

b.)between .02 and .05

c.)less than .005

d.) It is impossible to determine without knowing the true value of B2

Ans: c

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