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You Would Like to Find the Effect of Gender and Marital

question 37

Essay

You would like to find the effect of gender and marital status on earnings. As a result, you consider running the following regression:
ahei= β0 + β1×DFemmei + β2×DMarri + β3×DSinglei + β4×educi+...+ ui
Where ahe is average hourly earnings, DFemme is a binary variable which takes on the value of "1" if the individual is a female and is "0" otherwise, DMarr is a binary variable which takes on the value of "1" if the individual is married and is "0" otherwise, DSingle takes on the value of "1" if the individual is not married and is "0" otherwise. The regression program which you are using either returns a message that the equation cannot be estimated or drops one of the coefficients. Why do you think that is?

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Definitions:

M1

A segment of the money supply encompassing all tangible forms of money such as bills and coins, alongside demand deposits and additional liquid assets maintained by the central bank.

Demand for Money Schedule

A representation of the relationship between the quantity of money people wish to hold and the interest rate, other factors being constant.

Quantity of Money

The total amount of money in circulation or in existence within a particular economy.

Interest Rate

Interest Rate is the proportion of a loan that is charged as interest to the borrower, typically expressed as an annual percentage of the loan outstanding.

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