Consider the multiple regression model containing three independent variables(adsbygoogle = window.adsbygoogle || []).push({});

y = B0 + B1x1 + B2x2 + B3x3 + u

You are interested in estimating the sum of the parameters on x1 and x2; call this O1 = B1 + B2

a) Show that O hat1 = B hat 1 + B hat 2 is an unbiased estimator of O1.

b) Find V ar(O hat 1) in terms of Var(B hat1), Var(^B hat 2), and Corr(B hat 1, B hat 2).

I get that for a) E(O hat1)= E(B hat 1 + B hat 2) = E(B hat 1) + E(B hat 2) = B1 + B2 makes it unbiased, but Im not sure what to do for b)

help please

should I post this in a different section?

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# Homework Help: Multiple regression model

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