Question: Suppose we estimate a multivariate model where we estimate property values for a bunch of residential properties. We include lots of home and property characteristics,

Suppose we estimate a multivariate model where we estimate property values for a bunch of residential properties. We include lots of home and property characteristics, but omit a measure of local school quality. Among our estimates we find that having lots of books and book shelves in a house is strongly associated with higher property values. Given our omitted variable, which is the most reasonable interpretation

Group of answer choices

The beta on books is attenuated since people that own lots of books tend to live near good schools and also have high property values.

The beta on books is upwardly biased since people that own lots of books tend to live near good schools and have high property values.

The beta on books is attenuated since people that own lots of books tend to live near good schools and also have low property values.

The beta on books is upwardly biased since people that own lots of books tend to live near good schools and also have low property values.

The beta on books should not suffer from omitted variable bias since people there isn

t a relationship between number of books in homes and the quality of the local school district.

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