Course Solutions Uncategorized (Solved) : 1 Analytical Problems 1 Suppose Interested Modeling Personal Savings Save Function Persona Q33389029 . . . .

(Solved) : 1 Analytical Problems 1 Suppose Interested Modeling Personal Savings Save Function Persona Q33389029 . . . .

 

1 Analytical Problems 1. Suppose you are interested in modeling personal savings (save) as a function of personal income (inci) You have data for a time period before WWII 1900-1940, and a period after WWII 1960-1990. (a) Define a dummy variable called Posti that is only equal to 1 if observation i comes from the period after WWII b) Write out a linear regression model that would allow you to test if the relationship between savings and income changed after WWII. (The dependent variable in the regression should be save). c) Suppose instead of using a dummy variable, you 

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