Consider the simple population regression function: y_i = ₁ +₂x_i + e_i where E(e_i)=0 and var(e_i)= ². In each of the following cases indicate whether the statement is TRUE or FALSE. If only part of the statement is correct, treat the statement as FALSE. Indicate your answer by writing TRUE or FALSE in the space after each part.(2 points each)

a. The slope estimator b₂* will be biased if ₁ 0, but you incorrectly estimate the model without the intercept.

_________

b. The slope estimator b₂** will be biased if ₁ = 0 but you incorrectly estimate the model by including an intercept.

________

c. var(b₂*) = var (b₂*)= ²/(x_i -x)² ____________.

d. In b. the variance of the efficient estimator of the slope coefficient (that is the estimator from the correct model) is

var(b₂) = ²/x_i². Note: b₂ is slope estimator in the correct model in b. ___________.