# Both dadcoll and mumcoll variables are significant at 1% in predicting yrsed (Table 1) and both are positively correlated

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## Both dadcoll and mumcoll variables are significant at 1% in predicting yrsed (Table 1) and both are positively correlated

(c) Both dadcoll and mumcoll variables are significant at 1% in predicting yrsed (Table 1) and both are positively correlated with the response. Both these variables are dummy with 1 indicating being college graduate and 0 otherwise. If all the other variables in the regression model remain unchanged, then father being a college graduate is expected to increase years of education in his ward by 0.704 years. If all other variables in the regression model remain unchanged, then mother being a college graduate is expected to increase years of education in his ward by 0.461 years.

(d) From Table 1 it is clear that if 1 unit of dist is decreased, all other variables remaining unchanged, years of completed education increase by 0.016 years. Note that the unit of measurement for distance is 10s of miles. Hence 20 mile is equivalent to 2 units. Hence on an average, the increase in years completed is 2*0.016 = 0.032 years. The claim of increase by approximately 0.15 year if the distance to the nearest college is decreased by 20 miles does not seem tenable.

Model 1 was the fill model but model 2 was a simpler model. The hypothesis was whether model 2 may be used in place of model 1. However, this hypothesis is rejected and the conclusion drawn is taken as a group the variables dadcoll, mumcoll and cue80 may not be eliminated from the model.

(f) From Table 1 it is seen that both the regression coefficients corresponding to black and Hispanic are significant, even though the significance of black is only at 10% level. In fact, its p-value is 6%. Both the coefficients are positive. Hence one may conclude that being Hispanic is expected to increase years of completed education by 0.54 years. Similarly, being black also is expected to increase years of completed education by 0.28 years.

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