(i) In column (3) of Table 9.2, the coefficient on educ is .018 and it is statistically insignificant, and that on IQ is actually negative, – .0009, and also statistically insignificant. Explain what is happening.

(ii) What regression might you run that still includes an interaction to make the coefficients on educ and IQ more sensible? Explain

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TABLE 9.2 Dependent Variable: log(wage) Independent Variables (1) (2) (3) educ .065 .054 .018 (.006) (.007) (.041) еxper .014 .014 .014 (.003) (.003) (.003) tenure .012 .011 .011 (.002) (.002) (.002) married .199 .200 .201 (.039) (.039) (.039) south -.091 -.080 -.080 (.026) (.026) (.026) urban .184 .182 .184 (.027) (.027) (.027) black -188 -143 -.147 (.038) (.039) (.040) 10 .0036 -.0009 (.0010) (.0052) educ · 1Q .00034 (.00038) intercept 5.395 5.176 5.648 (.113) (.128) (.546) Observations 935 935 935 R-squared 253 .263 .263