5.The most common justification provided for the tax subsidy to homeownership in the US is thathomeownership has positive externalities that renting does not. As Glaeser and Shapiro (2002)write: "To its supporters, the home mortgage interest deduction is the cornerstone of Americansociety. Homeownership gives people a stake in society and induces them to care about theirneighborhoods and towns. By subsidizing property ownership, the deduction induces people toinvest and then to have a stake in our democracy. Ownership makes people vote for long-runinvestments instead of short-run transfers."Consider the following regression model:Мeetingsi 3D Bo + Bi x Нотеower + uMeetings is the number of town hall meetings the individual attended in the last year andHomeowner equals 1 if the individual is a homeowner. A researcher who collects data andregresses Meetings against Homeowner finds that B, > 0.The OLS estimator, B, however, likely suffers from omitted variable bias because the set ofpeople who buy homes are likely to be the types of persons who would be more inclined tomake social connections, participate in the political process, and take care of their propertieseven if they were renting. Because of this omitted variable bias, it is likely the case thatB1.A)В)

Given information: The regression model is given.

Answered: The most common justification provided…

MATLAB: An Introduction with Applications

6th Edition

ISBN:9781119256830

Author:Amos Gilat

Publisher:Amos Gilat

Chapter1: Starting With Matlab

Section: Chapter Questions

Problem 1P

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You may need to use the appropriate appendix table or technology to answer this question. Individuals filing federal income tax returns prior to March 31 received an average refund of $1,059. Consider the population of "last-minute" filers who mail their tax return during the last five days of the income tax period (typically April 10 to April 15). (a) A researcher suggests that a reason individuals wait until the last five days is that on average these individuals receive lower refunds than do early filers. Develop appropriate hypotheses such that rejection of H0 will support the researcher's contention. A) H0: ?= $1,059 Ha: ? ≠ $1,059 B) H0: ?< $1,059 Ha: ?≥ $1,059 C) H0: ? ≥ $1,059 Ha: ? < $1,059 D) H0: ?> $1,059 Ha: ? ≤ $1,059 E) H0: ?≤ $1,059 Ha: ? > $1,059 (b) For a sample of 400 individuals who filed a tax return between April 10 and 15, the sample mean refund was $910. Based on prior experience, a population standard deviation of ? = $1,600may be…

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