What percent of variation in Y is explained by the model.
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2:
In estimating the following model by least square estimator (LSE),
Y; = p X₂ + U;
a) Show that LSE of B is a linear estimator;
b) Show that LSE of B is an unbiased estimator of B. [You must clearly specify the
assumption(s) that you must make about the error term Ui]
c) Derive the variance of the LSE estimator of B. [You must clearly specify the
assumption(s) that you must make about the error term Ui]
Note: Show each step of your derivation in answering each part of the question.
[15]