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Example Questions
Example Question #1 : How To Find Confidence Intervals For The Slope Of A Least Squares Regression Line
You estimate a regression model with and , where is the beta coefficient and is the standard error. Construct 95% confidence intervals for .
Possible Answers:
Correct answer:
Explanation:
To construct 95% confidence intervals for , we simply take the coefficient and add/subtract . This is because is assumed to follow a symmetrical distribution (the normal), and 95% of the values in the sampling distribution are contained within 1.96 standard errors of .
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