I'm having some trouble understanding this horribly incoherent load of jargon published institute in the core reading. I'd like to know what the exact assumptional differences between EBCT model I and II are,
Under model II, since the Xj's given theta are NOT identically distributed, then why would E(xj|theta) and Pjvar(xj|thera) not depend on j? Why would assumption 2.2 be a weekend form of it's model I equivalent only to go on and make 2 more assumptions that are heavier?
Appreciate any explanation between the difference in assumptions between model I and II, read chapter atleast 5 times, do not understand. Thank you.
Last edited by a moderator: Jul 26, 2010