Explain the logic behind of model-inclusion of variables


Assignment:

Writing the Paper Show that you have understood and are able to apply some of the statistical concepts covered in the class. The paper should have the following parts:

Introduction

a. State the problem you want to study (what question(s) are you asking)?

b. Explain why answering this question is important.

c. Include a brief literature review and explain how your project adds to this literature.

The Model

d. Explain the logic behind of your model, inclusion of variables, statistical method used..etc.

e. State your expectations of the signs of the coefficients (specify the hypothesis you would like to test with the data).

Reporting your results

f. Interpret your results.

g. Test hypotheses and report confidence intervals where appropriate.

h. Where appropriate use your estimated model for prediction (forecasting).

i. Check for violations of classical assumptions and other problems with specification

Summary

j. Summarize your findings and conclude by discussing what you would do next to improve the reliability of your report.

Course Outline: ( Do not exceed the following knowledge to write the paper)

1. Two-Variable Regression Model (O.L.S.)

2. Multiple Regressions

3. T & F tests

4. Dummy Variables

5. Serial Correlation: Diagnostics and Corrections

6. Forecasting with a Single Equation Regression Model

7. Specification error tests

8. Log Linear and Quadratic Models

9. Granger Causality

10. Non-Nested Hypotheses

11. Panel Models

12. Heteroskedasticity Tests

13. ARCH/GARCH Models

14. Simultaneous Equations

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