1Medium10 marks
Let x_1, x_2, ..., x_n be n given observations, and suppose that
Y_i = beta_0 + beta_1 x_i + e_i; i = 1, 2, ..., n,
where beta_0, beta_1 are unknown parameters and e_i are mutually independent normal random variables with E(e_i) = 0 and V(e_i) = sigma^2, i = 1, 2, ..., n. Also, sigma^2 is assumed to be unknown.
Test the null hypothesis H_0: beta_0 = beta_1 = 0.