Your Textbook States That Under Certain Restrictive Conditions, the T-

question 30

Essay

Your textbook states that under certain restrictive conditions, the t- statistic has a Student t-distribution with n-2 degrees of freedom. The loss of two degrees of freedom is the result of OLS forcing two restrictions onto the data. What are these two conditions, and when did you impose them onto the data set in your derivation of the OLS estimator?

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