Suppose that Y 1 , … ,Y n are i.i.d. random variables with the probability distribution given in Figure 2.10a. You want to calculate Pr( 11eb817c_76fc_8373_84e6_7d0daf4b8cc2_SM2685_11 0.1). Would it be reasonable to use the normal approximation if n = 5 What about n = 25 or n = 100 Explain.

Introduction to Econometrics 3rd Edition by James Stock, Mark Watson

Edition 3ISBN: 978-9352863501

Edition 3ISBN: 978-9352863501

Exercise 7

Suppose that Y 1 , … ,Y n are i.i.d. random variables with the probability distribution given in Figure 2.10a. You want to calculate Pr(

0.1). Would it be reasonable to use the normal approximation if n = 5 What about n = 25 or n = 100 Explain.

Explanation

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We are told that
are i.i.d. random va...