What is the interpretation of b0

Assignment Help Microeconomics
Reference no: EM13882622

Suppose you are interested in estimating the effect of hours spent in an SAT preparation course (hours) on total SAT score (sat). The population is all college-bound high school seniors for a particular year.

(i) Suppose you are given a grant to run a controlled experiment. Explain how you would structure the experiment in order to estimate the causal effect of hours on sat.

(ii) Consider the more realistic case where students choose how much time to spend in a preparation course, and you can only randomly sample sat and hours from the popu- lation. Write the population model as sat 5 b0 1 b1hours 5 u where, as usual in a model with an intercept, we can assume E(u) 5 0. List at least two factors contained in u. Are these likely to have positive or negative correlation with hours?

(iii) In the equation from part (ii), what should be the sign of b1 if the preparation course is effective?

(iv) In the equation from part (ii), what is the interpretation of b0?

Reference no: EM13882622

Questions Cloud

Explain why a realtime update of fixed asset records : Explain why a realtime update of fixed asset records might be preferable to batch processing of fixed asset changes.
Compute color histograms and construct arff files : Construct training data files using the training image data for three different bin numbers and construct the five different classifier models using each training data file.
Determine the effect of the errors on retained earnings : Determine the effect of the errors on retained earnings at January 1, 2013. (Ignore income taxes.)
Discuss how nonverbal communication could influence : Discuss how nonverbal communication could influence whether or not a message is perceived accurately.
What is the interpretation of b0 : Suppose you are given a grant to run a controlled experiment. Explain how you would structure the experiment in order to estimate the causal effect of hours on sat.
Why are some fixed assets susceptible to theft : Why are some fixed assets susceptible to theft?
Hodge''s periodic inventory system : 1.On November 21, 2013, a fire at Hodge Company's warehouse caused severe damage to its entire inventory of Product Tex.
Fixed assets are purchased and retired frequently : Fixed assets are purchased and retired frequently. Given this frequent change, why are clear accounting records of fixed assets necessary?
Find the area of the triangle por with vertices : Find the area of the triangle POR with vertices P(-2,4,1),Q(3,1,-1),R(-1,2,-2).

Reviews

Write a Review

Microeconomics Questions & Answers

  How does the understanding of two theories that you

social emotional developmental theories have been conceptualized based on the work of erik erickson stanley greenspan

  Explain what the rate of money growth should equal

It is sometimes suggested that the federal reserve should try to achieve zero inflation. If we assume that velocity is constant, does this zero-inflation goal require that the rate of money growth equal zero

  Market structures evolution

The four kinds of market structures are Perfect Competition, Monopoly, Oligopoly, and Monoplistic Competition. Given dynamics of competition, think of the different sequential paths of market structures which firms can move by over time (any of th..

  Average cost-minimizing activity level

Compute output, marginal cost, average cost, price, and profit at the average cost-minimizing activity level. Compute these values at the profit-maximizing activity level.

  Deduce algebraically the quantities that must be produced

greener grass company ggc competes with its main rival better lawns and gardens blg in the supply and installation of

  Unemployment in australia

Every single state separately as unemployment rate, participation rate, change in vacancies, employment growth or decline etc. All data needs to be based in either 2013 annual report, or 2014 first half year.

  What price should the manager charge for the calculators

The California Instruments Corporation, a producer of electronic equipment, makes pocket calculators in a plant that is run autonomously. The plant has a capacity output of 200,000 calculators per year, and the plant's manager regards 75 percent o..

  Explain how the analyst can exploit that advantage

1. Identify the feature of panel data that offers an advantage over cross sectional data and explain how the analyst can exploit that advantage

  If a corporation issued 3000000 in bonds which pay 10

question 1 if a corporation issued 3000000 in bonds which pay 10 annual interest what is the annual net cash cost of

  The strategy as recent data points to increasing numbers of

bulls eye department store specializes in the sales of discounted clothing shoes household items etc. similar to the

  Analyze the major barriers for entry

Analyze the major barriers for entry and exit into the airline industry. Explain how each barrier can foster either monopoly or oligopoly. What barriers, if any, do you feel give rise to monopoly that will allow the government to become involved t..

  How the budget deficit is of tremendous concern

The budget deficit is of tremendous concern and all law makers agree that some measures should be taken to reduce it. However, The Republicans see the issue as a spending problem, while the Democrats see it as a revenue problem.

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd