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Question
1. Suppose that a least squares regression yields the following estimate: Wi = -1 + 0.3Ai where W is the hourly wage rate (in dollars) and A is the age (in years).
A second regression from another group of workers yields this estimate: Wi = 3 + 0.3 Ai - 0.01(Ai)^2
a. How much is a 20-year-old predicted to earn based on the first estimate?
b. How much is a 20-year-old predicted to earn based on the second estimate?
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