There is a wide disparity between education systems across the world. Suppose we have a dataset for 42 countries. The variable X is the average years of formal education for a person in a country, and Y is the per capita income (in thousands of dollars) in that country. We find a positive relationship between the two variables. Additionally, our regression shows the following results:
a. According to the regression results above, what percentage of the variation in income is explained by the education level?
b. What is the value of b1 in the regression Y=b0+b1X? (Hint: what is SSR and how is that related to b1?)
c. Suppose the answer to part b is b1=4 (it is not, but to avoid compounding any mistakes, assume it is to answer the following). What is the value of b0?
d. Continue to assume that b1=4. What is the 90% confidence interval for the true population slope coefficient β1?