Introductory Econometrics 4th Edition by Jeffrey Wooldridge

Exercise 10

Use the data in CHARITY.RAW to answer the following questions:
(i) Estimate the equation
gift = 0 + 1 mailsyear + 2 giftlast + 3 propresp + u by OLS and report the results in the usual way, including the sample size and R-squared. How does the R-squared compare with that from the simple regression that omits giftlast and propresp
(ii) Interpret the coefficient on mailsyear. Is it bigger or smaller than the corresponding simple regression coefficient
(iii) Interpret the coefficient onpropresp. Be careful to notice the units of measurement of propresp.
(iv) Now add the variable avggift to the equation. What happens to the estimated effect of mailsyear
(v) In the equation from part (iv), what has happened to the coefficient on giftlast What do you think is happening