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Q21Section A (Section A)21 of 60

Least squares from five summary sums

Consider the simple linear regression model yi=α+βxi+ϵi,i=1,2,…,n,y_{i}=\alpha+\beta x_{i}+\epsilon_{i}, i=1,2,…,n, where ϵi\epsilon_{i}'s are i.i.d. random variables with mean 00 and variance σ2∈(0,∞)\sigma^{2}\in(0,\infty). Suppose that we have a data set (x1,y1),…,(xn,yn)(x_{1},y_{1}),…,(x_{n},y_{n}) with n=20n=20, ∑i=1nxi=100\sum_{i=1}^{n}x_{i}=100, ∑i=1nyi=50\sum_{i=1}^{n}y_{i}=50, ∑i=1nxi2=600\sum_{i=1}^{n}x_{i}^{2}=600, ∑i=1nyi2=500\sum_{i=1}^{n}y_{i}^{2}=500 and ∑i=1nxiyi=400\sum_{i=1}^{n}x_{i}y_{i}=400. Then the least square estimates of α\alpha and β\beta are, respectively,

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