Question 1: Show the validity of the third equality in the IV representation of the FE estimator: NT βrc = (Xx) xy ΣΣ (xit - Xi) (xit - Xi)" - ") it i=1 t=1 -1 N Τ Ν Τ ΣΣ (x - Xi) x(t) ΣΣ (xit - Xi) yit i=1 t=1 i=1 t=1 || - NT NT ΣΣzx) ΣΣziyit \i=1 t=1 i=1 t=1 -1 N T ΣΣ (xit - Xi) (yit - Ji) i=1 t=1

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