Using data from 50 workers, a researcher estimates Wage = beta_0 + beta_1 Educat

Question

Using data from 50 workers, a researcher estimates Wage = beta_0 + beta_1 Education + beta_2 Experience + beta_3 Age + epsilon, where Wage is the hourly wage rate and Education, Experience, and Age are the years of higher education, the years of experience, and the age of the worker, respectively. A portion of the regression results is shown in the following table. a-1. Interpret the point estimate for beta_1 As Education increases by 1 unit, Wage is predicted to increase by 1.37 units, holding Age and Experience constant. As Education increases by 1 unit, Wage is predicted to increase by 0.35 units. As Education increases by 1 unit. Wage is predicted to increase by 1.37 units. As Education increases by 1 unit. Wage is predicted to increase by 0.35 units, holding Age and Experience constant. a-2. Interpret the point estimate for beta_2. As Experience increases by 1 unit, Wage is predicted to increase by 1.37 units. As Experience increases by 1 unit, Wage is predicted to increase by 0.35 units. As Experience increases by 1 unit, Wage is predicted to increase by 1.37 units, holding Age and Education constant. As Experience increases by 1 unit, Wage is predicted to increase by 0.35 units, holding Age and Education constant. b. What is the sample regression equation? (Negative values should be indicated by a minus sign. Round your answers to 2 decimal places.) y = + Education+ Experience+ Age c. Predict the hourly wage rate for a 22-year-old worker with 5 years of higher education and 2 years of experience. (Do not round intermediate calculations. Round your answer to 2 decimal places.) y

Explanation / Answer

a - 1) Option A

a - 2) Option D

b) y = 6.51 + 1.37 (Education) + 0.35 (Experience) + (-0.04) Age

c) 13.18

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