Parameter Estimation and Evaluation Maximum Likelihood Estimation Maximum Likelihood Estimation When In L(X")is twice continuously differentiable with respect to0∈Θ，MLE solution will be easy to find.A necessary condition for MLE is that a must satisfy the first order conditions (FOC): aln L(X") 00 =0=0, which consists of p equations if 0 is a p x 1 parameter vector.From this set of first order conditions,we can solve for 0.Graphically,MLE 0 responds to a zero slope for the likelihood function;see Figure 8.2. Parameter Estimation and Evaluation Introduction to Statistics and Econometrics April 21,2020 24/207Parameter Estimation and Evaluation Parameter Estimation and Evaluation Introduction to Statistics and Econometrics April 21, 2020 24/207 Maximum Likelihood Estimation Maximum Likelihood Estimation