Question: In Step 4, why does the linear regression model over/under-estimate the coefficient for 'Quota' compared to that of the Tobit model? Group of answer choices
In Step 4, why does the linear regression model over/under-estimate the coefficient for 'Quota' compared to that of the Tobit model? Group of answer choices The linear regression model ignores the data censoring and concludes that as 'Quota' decreases, there is little change in 'DataUse' because its values remain zero, resulting in underestimation of Quota's coefficient. The difference in the coefficient estimates between the two models is due to random perturbation in the data. In the linear regression model, when 'Quota' increases, 'DataUse' will turn positive, so its coefficient is overestimated. In Tobit model, even if 'Quota' increases, 'DataUse' still remains zero, so its coefficient is underestimated
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