Your Textbook Estimates the Initial Relationship Between the Percentage Change $\widehat { \%ChgP}\text {t }=-0.40+0.47 F D D_{\mathrm{t}}$

question 20

Essay

Your textbook estimates the initial relationship between the percentage change of real frozen OJ and the freezing degree days as follows: $\widehat { \%ChgP}\text {t }=-0.40+0.47 F D D_{\mathrm{t}}$
$(0.22)\quad(0.13)$
$t=1950: 1-2000: 12, R^{2}=0.09, S E R=4.8$
a. Calculate the t-statistic for the slope coefficient. Can you reject the null hypothesis that the coefficient is zero in the population?
b. The above regression was estimated using HAC standard errors. When you re-estimate the regression using homoskedasticity-only standard errors, the standard error of the slope coefficient drops to 0.06. Calculate the t-statistic for the slope coefficient again. Which of the two standard errors should you use for statistical inference?

---

Definitions:

Fundamental Postulate

A core principle in Kelly's personal construct theory stating that a person's processes are psychologically channelized by the ways in which he anticipates events.

11 Corollaries

A set of principles associated with George Kelly's personal construct theory that explain how individuals' psychological processes are organized.

Personal Construct Theory

A psychological theory proposing that individuals interpret the world and experiences through a unique system of personal constructs.

Therapeutic Technique

A method or practice used within therapy to help individuals cope, recover, or improve mental health and well-being.