Question: In Problem 2 in Chapter 4, we added the return on the firms stock, ros, to a model explaining CEO salary; ros turned out to

In Problem 2 in Chapter 4, we added the return on the firm’s stock, ros, to a model explaining CEO salary; ros turned out to be insignificant. Now, define a dummy variable, rosneg, which is equal to one if ros , 0 and equal to zero if ros $ 0. Use CEOSAL1 to estimate the model log1salary2 5 b0 1 b1log1sales2 1 b2roe 1 b3rosneg 1 u.

Discuss the interpretation and statistical significance of b^

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