QUESTION 7 This exercise refers to the drunk driving panel data regression, summarised in Table 10.1 on
Question:
QUESTION 7
This exercise refers to the drunk driving panel data regression, summarised in Table 10.1 on pages 31 and 32 of the Lecture 8 slides.
Suppose you are interpreting the estimated coefficient on Real Income Per Capita (Income) as the causal effect on Traffic Fatality Rate. Choose the correct statement:
a. According to column (3), the true model must not include Income in the analysis.
b. According to column (4), when Income increases by $1, the number of fatalities would increase by 1.82 deaths per 10,000 but the prediction is not statistically significant.
c. According to column (5), when Income increases by $1, the number of fatalities would increase by 0.09 deaths per 10,000 but the prediction is not statistically significant.
d. According to column (6), when Income increases by 1 percent, the number of fatalities would increase by 0.0179 deaths per 10,000 and the prediction is statistically significant.
e. According to column (7), when Income increases by 1 percent, the number of fatalities would increase by 0.01 deaths per 10,000 and the prediction is statistically significant.
Introduction to Econometrics
ISBN: 978-0133595420
3rd edition
Authors: James H. Stock, Mark W. Watson