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Suppose we are interested in modeling folk’s annual incomes at age 45 as a function of years in school. Suppose we gather data and estimate a univariate regression model such that β₁=7200. Then which of the following is correct?   A) We expect that if you don’t go to school at all, then you will earn about       $7200 per year at age 45

Suppose we are interested in modeling folk’s annual incomes at age 45 as a function of years in school. Suppose we gather data and estimate a univariate regression model such that β₁=7200. Then which of the following is correct?   A) We expect that if you don’t go to school at all, then you will earn about       $7200 per year at age 45

Linear Algebra: A Modern Introduction
Linear Algebra: A Modern Introduction
4th Edition
ISBN:9781285463247
Author:David Poole
Publisher:David Poole
Chapter3: Matrices
Section3.7: Applications
Problem 44EQ
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Suppose we are interested in modeling folk’s annual incomes at age 45 as a function of years in school. Suppose we gather data and estimate a univariate regression model such that β₁=7200. Then which of the following is correct?
 
A) We expect that if you don’t go to school at all, then you will earn about       $7200 per year at age 45
 
B) We expect that if you were to go to school another year, on average it         would boost your annual income by $7200 at age 45
 
C) The average residual for individuals in the sample will be about $7200
 
D) The average years of schooling for individuals in the sample is about 7.2       years
 
E) None of the above are correct
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