The file profits.csv includes data on profits and assets of 88 firms (some firms having missing data). The variables in the data set are and , which are each firm’s profit and assets in million dollars, and which is a dummy variable which is equal to 1 if the CEO of the firm is not the owner of the firm, and is zero otherwise. Use R to get the scatterplot of against . What does the scatterplot suggest?

profits

Question

The file  profits.csv  includes data on profits and assets of 88 firms (some firms having missing data). The variables in the data set are    and   , which are each firm’s profit and assets in million dollars, and    which is a dummy variable which is equal to 1 if the CEO of the firm is not the owner of the firm, and is zero otherwise. Use R to get the scatterplot of    against   . What does the scatterplot suggest?

profits <-- read.csv("profits.csv") 
   library(ggplot2) 
   ggplot(profits, aes(x = assets, y = profits)) + geom_point()

Accepted Answer

All of the above statements are true.

Answer

The errors are heteroskedastic.

Answer

OLS is an unbiased estimator.

Answer

The standard t-tests are not correct.

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The file profits.csv includes data on profits and assets of 88 firms (some fir...

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