Problem Set 3

# Problem Set 3 - Problem Set 3 Economics 103 Introduction to...

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Problem Set 3 Economics 103 Introduction to Econometrics Due Thursday, February 20, 2009 True/False/Explain 1. In the regression model: Y= β + β ₁female + β ₂education + ε , β represents the intercept for females. 2. In the model Y = β 0 + β log(X) + ε , the effect of X on Y does not depend on the level of x. 3. In the model Y = β 0 + β X + β 2 X 2 + ε the effect of X on Y does not depend on the level of X. 4. An insignificant coefficient (not statistically different from zero) means you should not include that variable in the model. 5. In the regression model: Y= β + β ₁female + β ₂education + β 3 education*female+ ε , β 3 represents the return to education for females. 6. If you estimate the regression model: Y= β + β ₁female + β ₂education + β 3 education*female+ ε , where Y is earnings, the constant term will represent the average earnings for men and Beta1 will represent the average earnings for women. 7. In the multiple regression model, the Adjusted- R 2 cannot be negative. 8. In the multiple regression model, the Adjusted R 2 is the same as the R-Squared when the explanatory variables are all statistically significant. 9.

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Problem Set 3 - Problem Set 3 Economics 103 Introduction to...

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