Week 3-4: The Simple Two-Variables Regression Model

The estimation procedure, The economic interpretation of the estimated coefficients, Hypothesis testing and the use of Z, t, F, test statistics, The confidence interval and tests of significance approaches, The ANOVA technique, The explanatory power of the model, Coefficient of determination vs. correlation coefficient: comparing regression and correlation theory, Econometric forecasting and confidence interval for the dependent variable against future value of the independent variable, Important features of a good forecast, Extensions of the model: Time as an explanatory variable, Dummy variables, Estimation through the origin.