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(10)Consider the model y i = 0 + 1 x i + u i . (a)Show that Cov ( y i .u i ) =

(10)Consider the model yi = 0 + 1xi + ui.

(a)Show that Cov(yi.ui) = 0

(b)Prove that the OLS provides an unbiased estimate of 1

(c)Prove that no other linear unbiased estimator for 1 has a smaller variance than the OLS estimator

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