Using Eviews To Perform F - Practical - week 6 PDF

Preview

Summary

week 6...

Description

Using EViews to perform F-test for testing the significance of advertising. 1.

Assume the model is

sales = β 1 + β 2 price + β 3advert + β 4advert 2 + e 2.

Run regression in EViews. We should obtain the output that looks like this.

3.

Click View, choose “Coefficient diagnostics” choose “Wald test – coefficient restrictions”. You will get the following dialog box where you need to put in the restrictions that you want to test.

4.

For this case we want to test

H 0 : β3 = 0, β4 = 0 . In terms of EViews the coefficients are stored under

the name c(). The number in the bracket is the order of the variable we submit to EViews when we run regression. For example c(1) is for

b1 , c(2) is b2

- the coefficient for the price variable. For the case of

testing the hypothesis above we type c(3)=0, c(4)=0 in the dialog box.

We should get this results. Wald Test: Equation: Untitled Test Statistic F-statistic Chi-square

Value

df

Probability

8.441360 16.88272

(2, 71) 2

0.0005 0.0002

Value

Std. Err.

12.15124 -2.767963

3.556164 0.940624

Null Hypothesis: C(3)=0,C(4)=0 Null Hypothesis Summary: Normalized Restriction (= 0) C(3) C(4)

Restrictions are linear in coefficients....