Its an assignment that was given to the class and most of the materials i have are not clear enoungh for me to use them for d assignment. Pls here is the question,
why is the ols(ordinary least square) estimator regarded as "best linear and unbiased estimator"?. Thank you all as you answer

Given the following two assumptions, OLS is the Best Linear Unbiased Estimator (BLUE). This means that out of all possible linear unbiased estimators, OLS gives the most precise estimates of and .

With the third assumption, OLS is the Best Unbiased Estimator (BUE), so it even beats non-linear estimators. Also given this assumption, is distributed according to the Student's t-distribution about , and is distributed in such a way about .

No HeteroskedasticityEdit
The variance of the Error terms are constant. . This means that the variance of the error term does not depend on the value of . If this is the case, the error terms are called homoskedastic. This is not always the case in economic data, for example the variation in a person's wage will vary with their level of education -- someone who is a high-school dropout will not have much variation in their wage, where people with Ph.D.s may see very different wages.

No Serial CorrelationEdit
The error terms are independently distributed so that their covariance is 0. .

Normally Distributed ErrorsEdit
The error terms are normally distributed.

Der are some symbols like. Alpha nd beta I can't type them out but if u really need to go tru de whole stuff I could send u a link

Thank you very much for the response, i appretiate it. Yeah pls share the link

Udoka89:
Der are some symbols like. Alpha nd beta I can't type them out but if u really need to go tru de whole stuff I could send u a link

udoka tanks. Pls send the link to me.