Table 1 records the hourly wage rate, in U.S. Dollars, and education, in years, for a...

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Table 1 records the hourly wage rate, in U.S. Dollars, and education, in years, for a random sample of 10 individuals. Table 1: Wage Rate and Education Individual Wage Rate (U.S. Dollars) Education (Years) 1 2 3 4 5 7 8 9 10 5.75 47.58 40.00 11.60 33.65 31.25 24.05 12.47 55.28 11.00 20 16 18 12 12 14 16 18 13 12 a. Estimate a simple linear regression model of wage rate on education. (10 marks) b. Interpret the estimated regression model. (4 marks) c. Estimate the standard error of the regression slope coefficient. (10 marks) d. Test the hypothesis that the wage rate and education are negatively re- lated. (6 marks) Table 1 records the hourly wage rate, in U.S. Dollars, and education, in years, for a random sample of 10 individuals. Table 1: Wage Rate and Education Individual Wage Rate (U.S. Dollars) Education (Years) 1 2 3 4 5 7 8 9 10 5.75 47.58 40.00 11.60 33.65 31.25 24.05 12.47 55.28 11.00 20 16 18 12 12 14 16 18 13 12 a. Estimate a simple linear regression model of wage rate on education. (10 marks) b. Interpret the estimated regression model. (4 marks) c. Estimate the standard error of the regression slope coefficient. (10 marks) d. Test the hypothesis that the wage rate and education are negatively re- lated. (6 marks)

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a To estimate a simple linear regression model of wage rate on education we need to use an Excel statistical software package Assuming a linear relati... View the full answer