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Techniques for analyzing the relationship between one (or more) "dependent" variables and "independent" variables.

3 votes
1 answer
174 views

Difference between errors and residuals. What is the mean and variance of each of them?

Suppose there is a simple linear model $y=\beta_0+\beta_1x+u$. Can we state that $\bar y=\beta_0+\beta_1 \bar x + \bar u$? I have this question because I come up with $Var(\bar u)$ when doing some …
4 votes
1 answer
1k views

Sampling variance of regression intercept when there is no regressor

Suppose we have a model $y=\beta_0+u$, where $E(u)=0$ and $Var(u)=\sigma^2$. I get the unbiased estimator $\hat\beta_0$ is just $\bar y$. But how can I get the variance of $\hat\beta_0$? Is it correct …