Imagine we have the following structural model sind fnl= Bo + B₁ atndrte + B₂priGPA+ B₂ ACT + u where • stndfnl is the standardized outcome on a final exam, • atndrte is the percentage of classes attended, • priGPA is the prior college grade point average, and • ACT is the ACT score (like the SATS or kind of like an ATAR). We think atndrte is endogenous. But we also have a variable dist, the distance from the students' living quarters to the lecture hall. We will use dist as an IV. Which of the following is the correct first stage equation? O dist+atndrte + priGPA+& ACT+ O atndrte & + & dist+v O dist=&+&atndrte + v O atndrte & + & dist+priGPA+ ACT+
Imagine we have the following structural model sind fnl= Bo + B₁ atndrte + B₂priGPA+ B₂ ACT + u where • stndfnl is the standardized outcome on a final exam, • atndrte is the percentage of classes attended, • priGPA is the prior college grade point average, and • ACT is the ACT score (like the SATS or kind of like an ATAR). We think atndrte is endogenous. But we also have a variable dist, the distance from the students' living quarters to the lecture hall. We will use dist as an IV. Which of the following is the correct first stage equation? O dist+atndrte + priGPA+& ACT+ O atndrte & + & dist+v O dist=&+&atndrte + v O atndrte & + & dist+priGPA+ ACT+
Chapter1: Making Economics Decisions
Section: Chapter Questions
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Transcribed Image Text:Imagine we have the following structural model
sind fnl = Bo + B₁ atndrte + B₂priGPA+ B₂ ACT + u
where
• stndfnl is the standardized outcome on a final exam,
• atndrte is the percentage of classes attended,
priGPA is the prior college grade point average, and
• ACT is the ACT score (like the SATS or kind of like an ATAR).
We think atndrte is endogenous. But we also have a variable dist, the distance from the
students' living quarters to the lecture hall. We will use dist as an IV.
Which of the following is the correct first stage equation?
O dist=do+datndrte + priGPA+& ACT+
○atndrte = 8 + & dist+v
O dist=8+ Satndrte + v
atndrte & +& dist+priGPA+ ₂ ACT+v
=
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