Question: Suppose that y = 14 +01 yo = Ho + 0 where E (01) = E (vo) = 0. Suppose that (91,30) 1 WC where

Suppose that y = 14 +01 yo = Ho + 0 where E (01) = E (vo) = 0. Suppose that (91,30) 1 WC where w {0,1} indicates treatment and x is a vector of observables and that E (1x) = E(001x) = 0. (a) Defining a = Mi - Ho and g (c) = E (volu), provide a regression that depends on a, 9(.), and xo. (6) Use the Frisch-Waugh Theorem to provide a regression that depends on f(x) = E (y) and p () = p (w = 1.6)rather than g(x)

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