Question: Please help me with solving questions ( c) and ( d) . Provide all the steps to get to the final solution. Thanks a lot!

Please help me with solving questions (c) and (d). Provide all the steps to get to the final solution. Thanks a lot!

the steps to get to the final solution. Thanks a lot! Consider

Consider the linear model y1 = Bo + Bit; + up, where y stands for wage, x for education (years of schooling) and u is an error term. Assuming that the three OLS assumptions hold, we want to estimate the parameter B1 using OLS.(c) Derive the standard error of 31 and the 95% confidence interval for the parameter ,3; assuming homoskedasticity, i.e., that E(u|rc,-) = 0'2. (d) What kind of problems are we faced with when trying to estimate the returns to education using such a univariate setup only

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