Question: Consider TSLS estimation with a single included endogenous variable and a single instrument. Then the predicted value from the first-stage regression is o+Z. Use the

Consider TSLS estimation with a single included endogenous variable and a single instrument. Then the predicted value from the first-stage regression is o+Z. Use the definition of the sample variance and covariance to show that syzy and ss. Use this result to fill in the steps of the derivation in Appendix 12.2. of Equation (12.4).

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