Consider a binary response variable y and an explanatory variable x. The following table contains the parameter estimates of the linear probability model (LPM) and the logit model, with the associated p-values shown in parentheses.

Variable................. LPM................... Logit

Constant................ −0.72.....................−6.2

............................(0.04)...................(0.04)

x...........................0.05......................0.26

...........................(0.06)................... (0.02)

a. Test for the significance of the intercept and the slope coefficients at a 5% level in both models.

b. What is the predicted probability implied by the linear probability model for x = 20 and x = 30?

c. What is the predicted probability implied by the logit model for x = 20 and x = 30?