* HINT: * The program assumes that all files are stored in * C:\monographregression\computercode * change directory if code is located elsewhere clear cd C:\monographregression\computercode use "data\stata\golf.dta" set scheme s1mono * Create orthogonal polynomials of kilometer and of age orthpoly kilometer , generate(kilometerop1 kilometerop2 kilometerop3) degree(3) orthpoly age , generate(ageop1 ageop2 ageop3) degree(3) * AIC optimal model with polynomials of second degree regress price kilometerop1 kilometerop2 ageop1 ageop2 * Save the residuals predict res, residuals * Generate the logarithm of the squared residuals gen logr2 = log(res^2) * Unweighted regression between the logarithm of the squared residuals and the explanatory variables regress logr2 kilometerop1 kilometerop2 kilometerop3 ageop1 ageop2 ageop3 TIA * Calculate the weights predict w replace w = 1/exp(w) * Classical regression model regress price kilometerop1 kilometerop2 ageop1 ageop2 * Weighted regression model regress price kilometerop1 kilometerop2 ageop1 ageop2 [weight = w]