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Econ122A+Sample+Final+Exam+-+Solutions

# 5 given the above information the ols estimator for

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Unformatted text preview: da_daily = soda /7 Take the log of both sides: Log(soda_daily) = log(soda /7) = log(1/7) + log(soda) This is the same as adding a constant to the dependent variable so the intercept estimate will change, but the slope estimate will not change. Questions 5- 6 are based on the following information. A simple linear regression that describes the effect of individuals’ cigarette smoking on health is given by Health = α + β cigarettes + u where Health is a measure of health that is on the scale of 1 to 5, where 1 means excellent health and 5 means poor health. So the bigger the number, the worse the health. 2 cigarettes is the average number of cigarettes smoked per day; the unobservable u is an individual’s health consciousness. 5. Given the above information, the OLS estimator for β in...
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