ABSTRACT
In earlier chapters we considered inference methods. They were the basis to characterize the properties of estimators proposed in Chapter 4 to estimate unknown parameters of a distribution. In Chapter 5 general approaches to testing hypotheses were discussed. Now let us apply these tools provided in the previous chapters to examine the relationship between an outcome variable and some explanatory variables. We will assume that the functions describing such relationships are of a specific form, including unknown parameters. Thus, the determination of the relationship between the considered variables is a problem of estimating unknown parameters. Moreover, the problem of finding an appropriate function leads to the problem of testing hypotheses about parameters.
