Question

You have obtained a sub-sample of 1744 individuals from the Current Population Survey (CPS) and are interested in the relationship between weekly earnings and age. The regression, using heteroskedasticity-robust standard errors, yielded the following result:_____.
Earn = 239.16 + 5.20×Age , R = 0.05, SER = 287.21.,
(20.24) (0.57)
where Earn and Age are measured in dollars and years respectively.
(a) Is the relationship between Age and Earn statistically significant?
(b) The variance of the error term and the variance of the dependent variable are related. Given the distribution of earnings, do you think it is plausible that the distribution of errors is normal?
(c) Construct a 95% confidence interval for both the slope and the intercept.

Answer 1

Answer:

Let me give you an example of a segment addition problem that uses three points that asks the student to solve for x but has a solution x = 20.

First, I assumed values for each x, y and z and then manipulated their coefficients to get the total at the end of each equation.

20 + 10 +30 = 60

40 + 0 + 40 = 80

40 + 10 = 50

Then exchangeing these numbers into values and we have the following equation.

x + 2y + 3z = 60

2x + 4z = 80

2x + z = 50 so its easy

If you will solve them manually by substituting their variables into these equations, you can get

x = 20

y = 5

z = 10

Explanation: