2) On the textbook\'s companion website dick on Data for Empirical Exerdises and

Question

2) On the textbook's companion website dick on Data for Empirical Exerdises and Test Bank (Updated Edition). you will find the data file Earnings and Heaght, which contains data on eernings, height, and other characteristics of a random sampleof U.S workers In this question make sure you use het er oskedasticty-robust standard errors Run a regression of Earnings on Height for men. Before you run the regression, use the following STATA command to drop the female workers from the data set. drop if sex=0 (sex is a binary variablewhich is equai to 1 if the person is male, and is equal to zero if the person is femaie i. What is the t-statistic? Is the estimated sope statiticly significant? Show your work using t-test. Construct a 90% oonfidence interval for the dope coeffiaet. Sow your wok. ii. 23regress earnings height, robust sumber of obs 786 F1. 7894)174-76 Prob > 2 R-squared0.0209 Root MSE Linear regression - 0.0000 26671 Robust P>It| [95% conf. Interval earnings Coef. std. Err. 1306.86 98.85688 13.22 0.0001113.074 1500.646 56705.2 29555-49 cons| -43130.34 6925.011-6.23 o.000

Explanation / Answer

a)

TS = 13.22

p-value = 0.000 < 0.05

hence it is significant

b)

df =7894

for 90 % t = 1.645

hence

confidence interval is

(1306.86 - 1.645 * 98.85688 , 1306.86 +1.645 * 98.85688 )

=(1144.24,1469.48)

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