Tag Archives: Federal budget

What signs would you have expected for the estimated slope coefficients of the two models?

Consider the following two least-squares estimates of the relationship between interest rates and the federal budget deficit in the United States: Model 1: N = 56, R2 = 0.00 where:         = Interest rate on AAA corporate bonds = Federal budget deficit as percentage of GNP   Model 2:   .369 N […]