Because their college had just upgraded its residence halls, two seniors decided to build a model of the decision to live on campus. They collected data from 533 upper-class students (first-year students were required to live on campus) and estimated the following equation:

Where:

D_i = 1 if the ith student lived on campus, 0 otherwise

UNIT_i = the number of academic units the ith student was taking

ALCO_i = the nights per week that the ith student consumed alcohol

YEAR_i = 2 if the ith student was a sophomore, 3 if a junior, and 4 if a senior

GREK_i = 1 if the ith student was a member of a fraternity/ sorority, 0 otherwise

a. The two seniors expected UNIT to have a positive coefficient and the other variables to have negative coefficients. Do the results support these hypotheses?

b. What problem do you see with the definition of the YEAR variable? What constraint does this definition place on the estimated coefficients?

c. Carefully state the meaning of the coefficient of ALCO and analyze the size of the coefficient.

d. If you could add one variable to this equation, what would it be? Explain.

Transcribed Image Text:

L:Pr(D; = 1) = 3.26 + 0.03UNIT; – 0.13ALCO; - 0.99YEAR; – 0.39GREK, (0.08) (0.12) (0.04) (0.21) N = 533 R = .668 iterations 4