Question 2 Suppose you are interested about the effect of weight (in lbs) on (we

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Question 2 Suppose you are interested about the effect of weight (in lbs) on (weekly) earnings, so you run the following regression: earnings, = 80 + Albs, + ui You find that f% = 500 and =-02. Your friend, however, is European and does not know what a pound is since he uses kilograms. You know the equation that converts pounds into kilograms is: lbs; = 2.2kg Help yur friend out by finding out what the coefficients Bo and B would have been had you used kg, (for kilograms) instead of lbs (for pounds) in your regression

Explanation / Answer

If weight had been in kgs instead of lbs, the coefficiens would be 2.2 times

So , New B0= -0.2*2.2=-0.44

New B1 = 500*2.2 = 1100

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