To test the effectiveness of a job training program on the subsequent wages of workers, we specify the model log(wage) = β0 + β1train + β2educ + β3exper + u, 11 where train is a binary variable equal to unity if a worker participated in the program. think of the error term u as containing unobserved worker ability. if less able workers have a greater chance of being selected for the program, and you use an ols analysis, what can you say about the likelybias in the ols estimator of β1?

Which is cheaper: eating out or dining in? the mean cost of a flank steak, broccoli, and rice bought at the grocery store is $13.04 (money.msn website, november 7, 2012). a sample of 100 neighborhood restaurants showed a mean price of $12.75 and a standard deviation of $2 for a comparable restaurant meal. a. develop appropriate hypotheses for a test to determine whether the sample data support the conclusion that the mean cost of a restaurant meal is less than fixing a comparable meal at home. b. using the sample from the 100 restaurants, what is the p-value? c. at a = .05, what is your conclusion? d. repeat the preceding hypothesis test using the critical value approach