Three Asymptotically Equivalent Test Procedures

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Three Asymptotically Equivalent Test Procedures
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Wald Lagrange Multiplier Tests
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Likelihood Ratio Test

• -1) The Likelihood Ratio Test Under
• the large sample distribution of
• -with degrees of freedom equal to the of
  restrictions imposed
• -straight forward and easy
• -tied closely to distributional
  assumptions

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Advantages of the Wald Test
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Disadvantage of the Wald Test

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Limiting Distribution of Wald
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Limiting Distribution of Wald
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Lagrange Multiplier Test