Question: Problem 1 Consider the following models. Model A: Yt = al + 02X2t + 03X3t + uit Model B: (Yt - X2t) = B1 +

Problem 1 Consider the following models. Model A: Yt = al + 02X2t + 03X3t + uit Model B: (Yt - X2t) = B1 + 32X2t + B3X3t + u2t a. Will OLS estimates of a, and B1 be the same? Why? b. Will OLS estimates of a3 and B3 be the same? Why? c. What is the relationship between a2 and B2? d. Can you compare the R terms of the two models? Why or why not

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