Question: i , from the p o p u l a t i o n a i i s the intercept for unit i and b

i, from the populationaiis the intercept for unit i and biis the slope:
yi=ai+bixi
With a random sample of size n, you implicitly draw n values ofbi along with n values ofaix and yai=+ci and bi=+di, then diis
.
Substituting ai=+ci and bi=+di into the initial model yields the following:
yi=+xi+ui, where ui=ci+dixi
True or False: Ifaiis uncorrelated with xi and biis uncorrelated with xi and xi2, then OLS consistently estimates and .
True
False
i , from the p o p u l a t i o n a i i s the

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