1. Does the coefficient on lackpfhigh change between Model 1 and Model 2? What does this imply about the presence of omitted variable bias in Model 1? Explain.
2. What is the sign of the omitted variable bias in Model 1? Explain how you arrived at your conclusion.

Model 2:

Call: Im(formula = DV ~ IV, data = terrorism) Residuals : Min 10 Median 30 Max -0. 6450 -0.6450 -0.2529 -0.2520 17.3448 Coefficients: Estimate Std. Error t value Pr(alt1) (Intercept) 0.2529 0.2626 0.963 0.337 IV 0.3921 0.3365 1.165 0.245 Residual standard error: 2.197 on 177 degrees of freedom (5 observations deleted due to missingness) Multiple R-squared: 0.097613, Adjusted R-squared: 0.002006 F-statistic: 1.358 on 1 and 177 DF, p-value: 0.2455Residuals: Min 10 Median 30 Max -0.3506 -0.3327 -0.0721 -0.0114 3.5105 Coefficients: Estimate Std. Error t value Pr(>Itl) (Intercept) 0. 073766 0. 099038 0.745 0.4575 IV 0.277099 0. 112200 2.470 0. 0146 gappc -0 . 002063 0.054936 -0.418 0.6766 Signif. codes: 0 0. 091 "' 0.01 0.05 '. * 0.1 ' ' Residual standard error: 0.5982 on 151 degrees of freedom (30 observations deleted due to missingness) Multiple R-squared: 0.05971, Adjusted R-squared: 0.04725 F-statistic: 4.794 on 2 and 151 DF, p-value: 0.009581