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StatisticsQ&A Library7. Imagine you regress earnings of individuals on a constant, a binary variable("Male") which takes on the value 1 for males and is 0 otherwise, and another binaryvariable ("Female ") which takes on the value 1 for females and is 0 otherwiseBecause females typically earn less than males, you would expecta) the coefficient for Male to have a positive sign, and for Female a negative signb) the coefficient for Male to have a negative sign, and for Female a positive sign.c) none of the OLS estimators to exist because there is perfect multicollinearity.d) both the coefficient for Male and that for Female to have positive signsQuestion

Asked Nov 24, 2019

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Here multicollinearity will exists between the two independent variable i.e, Male and Female. As per the assumption of multiple linear regression, there should be no relation betw...

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