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R code please



Problem 3 Use a simulation to verify that when X~N(0,1), Z N(0,1)Y X3+ 10X +Z, we have Var(X+Y) Var(X)+Var(Y)+2Cov(X, Y) and
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Answer #1

SOLUTION;-

GIVEN DATA;-

x <- rnorm(1000)
z <- rnorm(1000)

y <- x^3 + 10* x + z

var(x+y)
var(x) + var(y) + 2 *cov(x,y)

var(x-y)
var(x) + var(y) - 2 *cov(x,y)

Running code

> x <- rnorm(1000)
> z <- rnorm(1000)
>
> y <- x^3 + 10* x + z
>
> var(x+y)
[1] 202.4593
> var(x) + var(y) + 2 *cov(x,y)
[1] 202.4593
>
> var(x-y)
[1] 149.9148
> var(x) + var(y) - 2 *cov(x,y)
[1] 149.9148


note that

var(x+y) = var(x) + var(y) + 2 *cov(x,y) = 202.4593

similarly

var(x-y) = var(x) + var(y) - 2 *cov(x,y) = 149.9148

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