Let X be a discrete random variable representing the number…
Let X be a discrete random variable representing the number of times a student’s laptop will die during college (i.e., how many new laptops they’ll need to buy). X=0 means their original laptop never dies, and X=4 means they have four laptops die. It is also possible to observe X=1, X=2, or X=3, but no other values. The probability distribution is given byP(X=m) = (4-m)/10.What is the mean of X?
Read DetailsYou have a cross-sectional dataset from 2014 with one observ…
You have a cross-sectional dataset from 2014 with one observation per country. The Y variable is annual GDP growth (%), and the X variable is a measure of democracy, where 1=most democratic and 0=least democratic. You are interested in the slope coefficient in the linear projection of Y onto (1,X), i.e., the parameter b in LP(Y | 1,X) = a + bX. You’ve heard rumors that the less-democratic countries sometimes intentionally report GDP growth that is better than reality, but you have no way to actually test that hypothesis because in your dataset you only observe the GDP growth reported by each country, not the true GDP growth (unless they are identical). Let Y* be the true annual GDP growth, Y the observed/reported value, and M = Y – Y* the measurement error. If the rumor is true, then the OLS slope estimator has _______ asymptotic bias. (Hint: draw a picture.)
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