I want to generate data from the following linear model:
#y i = 0.5 + 2.5*x i + error, with X˜N(0;0.5) and error ˜N(0;0.25)
This is what I have done until now:
N <- 1000
sigma2 <- 0.5
sigma2err <- 0.25
beta <- c(0.5, 1.5)
data_gen<- function(N, sigma2, sigma2err, beta)
{
x <- rnorm(N, mean = 0, sd = sqrt(sigma2))
eps <- rnorm(N,mean = 0, sd = sqrt(sigma2err))
y <- beta[1]+beta[2]*x+eps
plot(x,y)
}
data_gen(N, sigma2, sigma2err, beta)