Question

The data set consists of information on 3800 full-time fll-erworkers. The highest educational achievement for each worker was either a high school diploma or a bachelors degree. The workers ages ranged from 25 to 45 years. The data set also contained information on the region of the country where the person lived, marital status, and number of children. For the purposes of these exercises, let AHEaverage hourly earnings (in 2005 dollars) Collegebinary variable (1 if college, O if high school) Female binary variable 1 if female, O if male) Ageage (in years) Mtheastbinary variable (1 if Region Northeast, O otheuise) Wd'westbinary variable (1 if RegionMidwwest, O othenwise) South = binary variable (1 if Region = South. O othen vise) Westbn ariable (1 if Region West, 0 othenwise) Results of Regressions of Average Hourty Earnings on Gender and Education Binary Variables and Other Characteristics Using Data from the Current Population Survey Dependent variable: average hourly earnings (AHE). Regressor 5.62 5.64 -2.70 0.30 College X1 Female (X2) Age (X3) Northeast (X4) Midwwest (X5) South6) Intercept 5.60 -2.70 0.30 0.71 0.62 -0.28 3.86 - 2.72 4.53 13.07 Summary Statistics 6.41 0.196 0.195 SER 6.46 0.181 0.181 6.40 0.200 0.199 Using the regression results in column (2) On average, a worker earns per hour Is age an important determinant of earnings? for each year that he or she ages. O A. Yes, because wages are not consistent across different age groups O B. No, because olde workers do not earn significantly more than younger wokers O C. Yes, because younger workers earn more than older workers O D. No, because the difference in wages is minimal

Answer 1

HERE ACCORDING TO THE MODEL IN COLUMN 2

WE HAVE

On average, a worker earns $ 0.3 per hour more for each year that he or she ages.

Q.2

For the second question is age an important factor in determination of earning

the answer is

a) YES, because wages are not consistent across different age groups