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Questions 13 through 16 are based on the following regression:

In the following regression, “healthy” is a dummy indicating a person self-reports that he/she is healthy, “employed” is a dummy indicating a person is employed, “age” is a person’s age, and “married” is a dummy indicating a person is married:

healthy=0.7-0.1 employed-0.002 age+0.4 married

(0.04)                    (0.002)          (0.12)

N=500, R2=0.88

Standard errors are reported in parentheses.  Sample size is 200.  R-squared is 0.58.

1. Interpret the coefficient -0.1 on employed.  (8pts)
1. Predict the probability of self-reporting healthy for a person who is employed, 50 years of age and married.  (8pts)
1. The answer you got from the previous question is actually greater than 1.  Explain why that is.  (8pts)
1. The effect of employed on healthy is statistically significant at the 5% level. (5pts)

A.   True

B.   False

C.   Maybe

Questions 13 through 16 are based on the following regression:

In the following regression, “healthy” is a dummy indicating a person self-reports that he/she is healthy, “employed” is a dummy indicating a person is employed, “age” is a person’s age, and “married” is a dummy indicating a person is married:

healthy=0.7-0.1 employed-0.002 age+0.4 married
(0.04)                    (0.002)          (0.12)

N=500, R2=0.88
Standard errors are reported in parentheses.  Sample size is 200.  R-squared is 0.58.

Interpret the coefficient -0.1 on employed.  (8pts)

Predict the probability of self-reporting healthy for a person who is employed, 50 years of age and married.  (8pts)

The answer you got from the previous question is actually greater than 1.  Explain why that is.  (8pts)

The effect of employed on healthy is statistically significant at the 5% level. (5pts)
A.    True
B.    False
C.    Maybe

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