exnoesd PariAD u(ovun eAnale /4udent

e (oehlRnt vuR to vaniattoy Ennvn temry

deneatim
Tooveyona tu14 WL (onBht ongiunR Vaniabla iuto

g'tonn
Rathan touidinting (1,0) wL lau touut Z Obvatiou
04
witu S a e
Raqin Pnopnt
P -O
N
u Obnva tio
Tha oddJ 'o is Rutio a Raguhed propanty to tu
Mumbna dbwnvaioy Wuith do uot hava Saru
nopnty bwva fioy haviug Raqui.
no
Cuanuttnshy
n-N no u uot uaviuz
"TRaquni
Raunit Pno/ty
nP
- Ye P-1
/MP P
(-PJ
let s-louider 'L- tu« Logit ob tajmd
y tah)uy tua Logcwntuim af tu Odda

yP-Log-P)-
youn þropur hu Liu b/w d-1
As a Ruut,wi

ogP

Logit Stnetelus- thu tai a diainibutioy

L +o
Thet's ouy Logi ttmvk ann kuow u a unuiuy
CunvA Supevimt LXanuiuq (unvR
we ha tu obio4 to any o o t u obwnvatou
at tui
evau po Oudlil
 Pt/
Pfo)

O P
P

4oRows tun P
1+0

Again you lauooL= Loylo)

P-e
/tet
t
wnita

Pj i obwnvutioy
ItYeti
Li-Lihtanauethou a explau tony vaniuble
Li
P
L Pot P* FPk
 n tu Moi towmdusd as ogit
o a t wvud b tu Lihe hood Juusfiou Joo obMnvaHon,

Y Oufrow yania
on1 obrwnva tho

Dun-obev41a to waVimj on u '

Ln (Yi uP; F (1- Yn{1-P;)

loy-Luha hoo u u e fio y o t u 1oi Mt þoobaboin

Juis can b marimiA C e be Stmuu frd b

Anatiou
MLE- EAimnton
OY t toivan 8 Se RaRVadun d p u u lan. vetto
4banauutsn
uttomi dn. din tnibu tiou XJ6)
a

by ja enti maton tu
6(X/o )ia oy Paf
' is disuta
,thuu CYJo) in poit
Nas un (fiD4

MLE Rigwnin to Hav) tw Lthahoodue thou

 MIE n nfon

ponuto- DistnibuHoy
-

et lowi
LOug atd
a d ity uut tioy wi Sto wRy derayiug 1ai9.
So we laueuey Log is He hu ItOuiy ntans f d in toutin

/Y e) =
e.x
wUu

J'e)

e) Log F(:/b)
2 (Lot 8 L09p - lB+ Digy

M Log6 t He loy JLO tI)L 1cyX

Dibyuatiy le) oin t0
JLD) thLo o
/6 2og

Suo

MLE 6

MLE d.heud o n dAtni buioy Fno hanu ws haN

Cowidnut adininibu hou Loug ti-Puruto

IainI butto
 *
Ditenut bjw Robusf cund
Rtentotiv Rtgneoiout
Cnd Regnsio
OLS

*Poouma ttin9- Ttenaho - Regnumio

Two MUtuod- Nawtou RapsBy MMtuod

Sonu Mtuod -

Auru wo ane tnyi ng to estinata Hu vitton a panea uuhh

9uondunto esfimats vetton a panctu ( )

Drign a iutialvalur a 8 0 W

d to bnidd£r
Ou tuingww by adding a vet ton E Ao tuat

,t-0
8 t -O
A ntjautonlt,
we CuM ould by updoatng tu þravidy iRtnadiou
hje to eq uaHou

t =
+Eu
IRtenaHioy outinwe uuti fwn is touwgngya

oEuu o c t u r uwww tu qne ditut a Log Lihjhne

I CloNR to 'o'

Hou0 to ind¬)- So tuat-OR tam þroCM t(ea2)

wi tu spus to havL as tabla eklimat

yas Joiut Pnotut a4 D,Y (e)

0)

Y-is gnadiautvtcton- oidy dRhi*ud o-dlos

Agnadut vae ton- Cau wp s tu uunatuu t u

dina tioy chsunga1 Log () on cuaugiusunuutn

Du' Dinectiou Ma thixi (unwan

tue a log Lihetishoa d
buuthoy Sue o uou
apidy tu bnadrtntis chan
 ytl diogL -

hua panautfun strata intnuaus | gna dituf

I posti vR.
It detrea ih gnadieut is-uga tiva

towevgn tuis abpnoaty tomi den tusLoA o Lu L

but uot how quicho y fha SLoh2 1s Chuugins

TwoLoq-Lihelihoo &) -

witMSuun gnadeiu bu
Ou
Spteijca io4 cheui quichy taan otun uuthon
pnr tu ML þooulum trud to onk boonly Sin
t treats bo tu tu Sfecalitatho4 saua way

Thathoy wtintne duud Nedtoy- Raprou -Ntuod

Ru cuuug iu dRuL

Whn 2u tus hun Hatnix

Fon twe oanattun -(d-B)

de de'

dp dedp

uty-muy gneatan dha

d dd

ulL
de dp
tuey oun- 8oudieuttAn be Chunnd Mone
Rexpidy o Caug au B chg
we ha d a Smallen ad hustuuut itdaud .

N- R þnosdA MLfo tuey rutlou

u
utt Feu dBus
 You -(ouidun-
ha) =
dLu L
en

den,deu

Tha erpeetuioua kemiuy jA aluo kuo o

9ulonuwutiou Matnix

Sconi MtuDd to Db tuiy 9lhnati ou Raanyicuu

Atimaton

yt u /d dLaoy
d dB ey
 CDuu veuta

Poimoq tgnam}Pjauwd to MDURR Rusbpous van)abe

valun Jueut awne te unt- Jete Pomipu Req nNiou
C nutR tue Regnus e
(neHitjeut suMAoiu t Lyhali hea).
31 tll s tuat dury eveatony vdabl
hav tatin ti caully sigiitonteee tou Ruspot
Vanable
hotun wend it tell us tuat oujry x Velus
wonRov Y valus- 9 i s bist undon Roane enuts
oudeoWows t u - Poim)ey vist»ibashoy-

x6is wx O wn Rspaux vanible I Sual Ju tege2

cuud ouu tablu -

tous1t must be podt} u

y(Duutt n u s t
JoQow JpoiNicy Jis tnibuthou
oune tutau au
iuute Shouad ba Sqme

Expeaufonty van)ubR mnt b coutuos, dithotouey

on onual-
 on
Sigweid- SshapR - CunvA- , ta (F touuedy
CLre tu Reprauut O-1 -ReApoun Met
t)
CE
tu Legit w (2) t nua (Prebit)
x
Th Hudon þoobey a LPM is excganatt phuueC
DVnetiuutoy af Coehticisu E,upucond Eis a
Loeiieut estine te
*Dai- Mangiual- ehtet Maasure tus cuau9 i
cuasnag velul Regnunajd by ou uui t
vautat
(uuasty RegnkMon, Loitu cll otuw
Vanlabl hiestCos tuu

*Eveny -He vl-hus -sHnut- jutapetati ou a

Hayualektut

LOy-dut- visuliy1ion io )nupentau t -

TD Idauti}y- pattinus ,tneuds uudte uHRian iu dutq -

T diotni buticya puttanuy beco rul iupontuu E

to be vioui zad -(as wR e u u tuut tatais uet
Men
uaiy diatoi butaJ)
Twne au mesty twe tybs a duta- Domi abu huuy
dioCutR aui touti e y uud ejpu vA uuti zticy
we u t h letsgelei t
 A henul deA T 1
HPu- pura net tni t Repneyututin.
4 tutpootab Pity de4ity u t f i o u huu tidu af a
Rador Van)ab le we hen ul deuj ty ow
bara n) distnié6utioy CauueF proferR taiu
data on Loe y wLweut ta aveld hakin q
c m u p ho aboutdistni bu hoy a data,

inontaut toolhon Jata viswatioy allouws

+o obenvt Som j ulpon tuuto baeueti oy

37
touutn) 0

5o
10 S 20 Pen cepitw Su ioru

(protubtitic)
Stats -oo beuý b tocuasHi-uuctiouad honus
O R teuM ueopon uta Res jd uals[ec ton tueat cuu uot
de dn t u HcdR),w Je tandnisH eSpeu picatiry
wi jail o captun tum ahu ta -

Stoas H Specij (atioy i> beHan huo¢rlei

uy wA
way wk
Way
CauD tMenpenata al
tuuucto ude tan duie
Speicatoy
 Rolacy date-n Modkli ng
pant Ipory þriany Se tonudeny dutu
ctoue u nìc tonw wituy tousiuow aut dituta kateyu

StocuastHe Mo driG wu tuoo is t}u usatun

Ro uaty
Ennadhe vanjaicy - msany poo bublity tueny

3Mod& -Sprcip tuthoy on tu wy duu bRuav-

Patu 1s hewsany honve dato4 oLO

to Subi tau iate t u tuony

uulMpdil
o avuu tuatt vatu eOou's ID -but Rea
tutu wwwn fotlo ws ucouLal diatrituHey

T d a t e Hatnibufioy uuwtbe þant Stati6tiul

MDd lRny tosuhve Revaut Risust
S tocuusic Vs Detennjmi t Rognasiou

Detenuiiust}c Rognniou RapRuus nuimiy valug Leity

xal bnadictid u a Regnioy AodAl Raudo uy vuriato
"-

Rgnaic4
unduud cpA is HDt Loisivuad Juju tzd y cdy
a n teo þreum aud a t to
au
ovnestattoy
tonnalaicubjuu x cuud y.

StouosHe PanMieu w devRlo/s2 o Solua u iMu

detaui uiAHL RegnimicH:S totuas Hc Regnausioy
ctd Rautery teuu (ênnoa) fo
presctad valuu u
tuaens able to produl tu tomluiey 6jw x aud
rone uppnopniutuly
7/0 014
Lety Li wely d2peudeu tvaniabl

Pl Ely) =
N
N: Nuubnn a obwnvaHou

Ho do simatz (Lnean- dapenuut

Vaniu ta)
by bLS Mt40 d
By OLS buten etHmatiy y
wR Hed to tousi dan

P2 t PYte -
gutancaF

B:0 vecfan ay þanamu tn

Y -N ) 4ax trir y exfauuteny vaniut
E Rasi vual
Fon w g oLS
Amuaphe u 1 Raidual q n uyto leateJ wity
rtruan[NDEndegulty M
Me deR RgnuAen
Rexid uol an Rsatd wity
EndegRui tyiu Mod1 Aegnuson ttarn in

Taha eeetuhey Du botM Si V a equuion (2)

 Expeztihou- coutitious þrebablity

E CY/Y,9)=
euioun þnotabiity to u
tuut y 1 i equ
Ply-) Jen givu , ) Ceuti tiou ecfectet
vad 1
PaLy1)x)= FC¥/L,B)
tuin gmi
Sutws
Fay /s)= Y.p ) -

Fi 2un)
PaCy/x)- I-xp -
HunSum robublitin = 1

Tu equautiou 3) aud (s) teqatuun iupRiy ab iuany

uin ModA} abo kuDd linuan Probabisity 1ueJA

onLPM CLiwan_lunveHodel)
iumn-fuucthe
ProbebRi Sucun t u expanteny vaniaa
i DRtan'
TLut wmy it in Kupuy LPM
 9utnetahcu ta p Chuuqe iu t u bcbabit a
Sutey due to cucuqa iI1 t u vani a bla Y
hoRdi ny cullotu vaniubla *ed at
i tuln'
ReAheetve a uvalu
-
APa 1 /x)= P, ar -
7Thia is also ueuu A PanHa probaby al
Aueu

Y:inany vani abln

w i baic tbutHDy abLS

-°h Mo

Couditiou expec hatiou a y Bxi

- valuus
A i binany - tuhus 1/o, tu Reniduu
Ca tah too valu0-P%) a (-p'¥;).

1-' 8'x
-pk,-
nia 4u = 'x, (1- B'v) + (1-PrYp.
Vani =
®'x, (1- $x')LI-p's,)+ Py, )

Ai) -Elyi) -9
Tuani aun is nDt homLA
dunti it io tu
httnecda
S ModR iug OLS tuurr i^ Cauu a
hatnofuuten he
Thin in
adu þaob&a af LPM
OLS willuet baehtrciaut
Tnuditioucily inols -hengn- Mutuod-
you Leu tuhe - 'Cenval St2s to
Miuiui3a hutnetesanccih
StRp 1: EntiuMata yi =
x,tuu
by OL
Step Coput i (l-i) aud
y LS
wwiew; %0-)D7/2
Rugav i/ ou tu
bsInaX/w
Rebt
Regnyioy
 1But iu meuuy protabiitis abovr | aud bal pu) ( fe
t w u tunsinpoosou IM LIu Robust Regnasion
tuin n pno 6in1 dw to utnodetanti ky fpn~uut iuu
t u Mo J l

So gu ondur to hauily t i s poobley wr hava Legi

Mod(Stna tiyg_ aj.uis topy) nu FimE

Past
Suppo Lor hava oa
detenta on ne d tatugen)sM
o ' euRa Seatiajoaundio
Rul o edutasiound attaiuhutut (E4u tatiou
E Cutayoniv)
JCein)9+iA net horogeneuy
t in hpo tutyo

F(CouRetud yeam af ocloe) hot toatneu)

Houutuhc uu ttio u
Hormotuutiquue hou Auy uuctiou tuet Can 6s
wni tteyo
Mouwtonic Juoneosio ua
horeubus unLHoy JA homotuHe
Ex(utiitybaneioy is hemetutie yune tiou)-
Codyon-henou wít uA tuoy higuaHook a esuCotl
humo u wì ty
(oupated high SchcelCCkto
3 LeoR.
hamoy wity heng
tuay - Clot )
1D Pmou wi ty tan
tianultoila educ ahon.
 "et-tosidar3
3 'hina rol teutgeni.
aniro
"hinaani teutegenin
Fon ainiciy
lalacgeny
3
i U< B
) Gmdivituek a l i y

PF(B)
P F
(p + - FLB'X)
PPI I-F(BMiD
P=
Flegitie ba CumluhvnNonuua drototbutou \

t uon MosaR losonti e pnuy own He or

ba

OndnadLogitNedi
8E oRou tuumuti Nonua dintnbu hou LoiLl b
ondud Probit HD4

GrensFonu Pncba6Rit adegeni h Py. Pan-t, na)

PF(B'u)
Pm- E (B% +a) -

FCBk)
PM-2 F(BI++d2) -F(G')
2 CUnR t Cut þoru-A
K
 Pm FCEX)
Ptm-
P
FLB)+F(p'Yta,)-FF(pr)
=

FBx td)
P t
Pu-T- F(B'x t,td)
Pmt P-,t
Pmt P- P F(Byt ,4,t -. n-
PI-Pmt P-.. +B)
P1-FCPY+ t*>t
Thin taubi solvz by
Newtoy Reabou Motuod^9Hencstou fno CUs
Ctrgeni t e o ndvw pöbub&i ty n to auwotw nq
K

ORDERED PRo3TT MBDEL

 uttpeiuF
) tcuwdu m Cetagenl ud
hinon ui
a<.. dm

6 RMpcu a Rspc Modu gunon

4 B' + (i2,2, n)-O
Y uvayiu, Ro

thet
Atuta wr tau
Y ana dinert9y obaenvaba, It
hot

oenva dauCatangeniu
WRnd to da a q ondua vaniabla-

Zi
-D otwnwin IE,2,
j-I2

Pock (Z i 1) -E Lj -Bxi ) -

(j -i P)
D (uuuIatvituudand nenuR diaBnibuhoy
= dRwity Juuchoy

u yi B
IZi =l , tuutuau y; a 0 1ujH(ataqeny
ttn Ceuube wnity