Answer Happy

Question 1 Suppose that you are interested in estimating the ceteris paribus relationship between wage and educ. For this purpose, you can collect data on a control variable, exper. Let a₁ be the simple regression estimate from wage on educ and let b₁ be the multiple regression estimate from wage on educ and exper. (That is, both a₁ and b₁ are estimated coefficients of educ.) Answer the following questions. (iii) If educ is highly correlated with exper, and exper has small partial effects on wage, would you expect se(a) or se(bi) to be smaller?