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Q28Section ST (Statistics (Q11–Q65))28 of 65

Covariance of sample mean and slope

Consider the simple linear regression model yi=β0+β1xi+ϵiy_i = \beta_0 + \beta_1 x_i + \epsilon_i, i=1,2,…,ni = 1,2,…,n, where β0\beta_0 and β1\beta_1 are unknown parameters, ϵi\epsilon_i's are uncorrelated random errors with mean 0 and finite variance σ2>0\sigma^2 > 0. Let yˉ=1n∑i=1nyi\bar{y} = \frac1n \sum_{i=1}^n y_i and β^1\hat\beta_1 be the least squares estimator of β1\beta_1. Then which one of the following statements is true?

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